Meralco taps additional 400-MW capacity for summer 2015

MANILA, Philippines – The Manila Electric Company (Meralco) is looking at contracting as much as 400 megawatts (MW) of additional power capacity in 2015 to address the anticipated supply deficiency in Luzon during the summer months.

Meralco President Oscar Reyes said the utility firm is already firming up negotiations for Power Supply Agreements (PSAs) and Interim Power Supply Agreements (IPSAs) with power producers.

“We are talking to everybody who can offer…at a price that is acceptable to the consumers and the regulator,” Reyes said in an interview on Friday, September 26.

He added, “It will be a portfolio. If we include IPSAs it could be 300 to 400 MWs in all.”

Reyes said Meralco is eyeing to extend its IPSAs with Toledo Power Company, Panay Power Corporation, 1590 Energy Corporation, and Panasia Energy, among others.

Meralco’s IPSAs are meant to lessen the utility firm’s exposure to the Wholesale Electricity Spot Market (WESM), the country’s electricity trading floor.

For the supply month of August, Meralco sourced 52.3% of its power requirements from PSAs; 46.7% from Independent Power Producers (IPPs); 0.8% from the WESM; 0.1% from IPSAs; and 0.1% from renewable energy.

Extending PSAs, beefing Interruptible Load Program

Meralco officials stressed the company is trying its best to cover its requirements for next year.

Meralco senior vice president for Customer Retail Services Al Panlilio said that the company is looking at extending all of its PSAs.

“Our IPSA with Bauang diesel power plant, for example, is still under negotiation. We are looking for more beyond what we already have. The tenure and prices are going to dictate if we sign up or not,” said Panlilio in a separate interview.

Meralco is also looking at additional capacities from JG Summit and Millennium Energy.

In a presentation submitted during the Senate hearing on September 25, the Department of Energy (DOE) said JG Summit can provide 60 MW and 100 MW from Millennium Energy to Meralco.

Millennium Energy owns a 310-MW gas turbine power plant at the Navotas City Fish Port Complex.

Also, the utility firm is continuously working aggressively on its Interruptible Load Program (ILP), Reyes said.

Meralco has around 368-MW commitments from private entities that can be tapped for the ILP.

Under the program, companies with self-generating capacities will be asked to use their ILP where industries and businesses will run their standby generator sets instead of getting power from the grid.

On September 25, DOE warned that a 7-week rotating brownout in the summer of 2015 is likely if Congress will not grant President Benigno Aquino III soonest the special powers to address the electricity supply deficiency in Luzon. – Rappler.com