MANILA, Philippines – A wholly-owned subsidiary of First Gen Corporation will supply the Manila Electric Company (Meralco) with 414 megawatts (MW) of power capacity for P3.7 per kilowatt hour (kWh).
First NatGas Power Corporation and Meralco signed a deal agreeing that power would be sourced from the Lopez-led firm's 414-MW San Gabriel combined cycle natural gas-fired power plant.
That power plant is located within the First Gen Clean Energy Complex in Batangas City.
First NatGas will use gas from the Malampaya field for the first 6 years unless the deal is extended by both parties in the event that liquefied natural gas (LNG) becomes available.
Solar Philippines had challenged the price offer of First NatGas to supply Meralco's 24/7 power at P2.99 per kWh.
First NatGas said its power supply deal will "enhance the quality of Meralco's power generation portfolio by providing competitive dependable baseload capacity and an immediate source of replacement power during outages of other baseload plants."
The power supply deal also gives an option for mid-merit supply matched with Meralco's ramping requirement since San Gabriel has the ability to rapidly ramp up and down upon notice.
Under the terms of the deal, power from San Gabriel is actually available for purchase by Meralco immediately.
But the sale of electricity to Meralco will only start after its approval by the Energy Regulatory Commission (ERC).
The deal is set to expire on February 23, 2024, unless otherwise extended by the parties. – Rappler.com