Meralco gets lone price challenge for solar plants

MANILA, Philippines – Power distributor giant Manila Electric Co. (Meralco) is now evaluating its next move after it received only one price challenge for its two solar power supply contracts, its top official said.

There was one price challenge for the offer made by Power Source First Bulacan Solar Inc. and none for Solar Philippines Tanauan Corp. during the Nov. 4 deadline, Meralco president Oscar Reyes said.

He said the price challenger is 7 Balboa of Soleq, the solar power arm of Singapore-based Equis Funds Group Pte Ltd.

In September, Meralco inked 20-year supply contracts with Solar Philippines and Power Source for a 50-MW supply each starting February 2017 and August 2018, respectively.

Both solar developers have offered a price of P5.39 per kilowatt-hour (kwh) for a period of 20 years, lower than the latest solar FIT rate of P8.69 per kwh, once their respective projects start operation.

The power distributor invited power players to participate in a price challenge to comply with the competitive selection process requirement.

Meralco is set to complete its evaluation within the week, Reyes said.

But the company is not closing its doors on having another round of competitive selection process for its first solar supply contracts, the company official said.

“We’re looking at the potential of how to handle it. We still have to make a decision,” Reyes said. “We have to look at other various things – track record, capability, reliability, pricing.”

Meralco distributes electricity to nearly six million in Metro Manila, Bulacan, Cavite and Rizal, as well as parts of Batangas, Laguna and Quezon.

Currently, Meralco gets its supply from contracts with a capacity worth about 2,000 MW, composed of 1,500 MW from First Gas plants of the Lopez Group and around 400 MW from the Quezon coal power plant.

It has signed supply contracts with seven power plants with over 3,500 MW in capacity for its long term requirements.