Solar Philippines nears new Meralco supply deal

MANILA, Philippines — Solar Philippines expects to close an 85-megawatt power supply contract with Manila Electric Co. (Meralco) soon, its top official said.

In a forum hosted by Financial Executives Institute of the Philippines (Finex), Solar Philippines president Leandro Leviste said Citicore Power Inc., which made an unsolicited offer to Meralco, did not exercise its right to match last month.

In compliance with the competitive selection process (CSP) policy, Solar Philippines challenged the P3.50 per kilowatt-hour (kwh) rate offered by Citicore with a P2.99 per kwh counter offer.

“We should sign soon,” Leviste said. “The price that we had offered is to show in good faith that this can be the standard price for 5,000 MW of solar that can replace the current pipeline of new fossil fuel power plants.”  

“It might not be an attractive price for a single 85-MW plant but it will be viable for 5,000 MW to replace fossil fuel,” he said.

Meralco is still completing the process for the price challenge for Citicore’s offer, senior vice president and head of utility economics Lawrence Fernandez said in another interview.

“I think we’re at that point that we have completed the evaluation of the price challenge. We’re now at the submission of the documentary requirements of the proponent,” he said, without elaborating the identity of the company.

The signing of contract will depend on how soon the proponent can submit all its requirements, Fernandez said.

“We will announce officially when the contract has been signed,” he said.

When Citicore Power offered to supply up to 85 MW to Meralco, the country’s largest distribution utility gave challengers until Aug. 14 to challenge the offer. Solar Philippines emerged as the lone challenger.

If the process leads to signing of the contract, this will be the second solar power supply contract of Solar Philippines with Meralco.

In October 2016, Solar Philippines Tanauan Corp. signed a 50-MW solar power supply contract with Meralco for P4.69 per kwh, lower than its initial offer of P5.39 per kwh because it was challenged by another solar firm. The contract will run for 20 years. 

The company will supply 25 MW from its solar farms in Tanauan, Batangas and Naic, Cavite.