Meralco, Japanese partners get Congress nod on Clark service

MANILA, Philippines — Manila Electric Co. (Meralco) and its Japanese partners have secured congressional nod to operate power distribution services in New Clark City in Tarlac.

“Our joint venture company (JVC) is for distribution only and we can’t contract yet because the franchise has not been granted to the JVC. It was only passed by Congress last week,” Meralco senior vice president Rogelio Singson said.

The JVC is composed of Meralco, Marubeni Corp., The Kansai Electric Power Co. Inc., and Chubu Electric Power Co. Inc.

Meralco and its Japanese partners signed a joint venture agreement with the Bases Conversion and Development Authority (BCDA) for the new power distribution system.

Once the franchise is signed by the President, Meralco can start procuring power to supply electricity to New Clark City.

“We have an arrangement with Tarelco (Tarlac Electric Cooperative Inc.) and BCDA to source power,” Singson said.

So far, Meralco and its partners are still on track to make available temporary power for the Southeast Asian (SEA) Games which will be held in New Clark City in November.

“Our obligation is to complete the substation which is scheduled for end-June,” Singson said.

The company earlier said the initial phase of the distribution network would involve overhead distribution lines and a substation to serve the SEA Games.

Meralco and its partners have estimated a total investment of P6.3 billion for the entire 25-year power distribution services in New Clark City in Tarlac, subject to the capital expenditure approval of the Energy Regulatory Commission (ERC).

The amount covers the financing, design and engineering, establishment, construction, development and operation and maintenance of the electric power distribution system in New Clark City for an initial period of 25 years, renewable for another 25 years.

New Clark City is envisioned to be the country’s first smart, disaster-resilient, and sustainable city.

Because of its strategic location in Northwest Luzon, it is being positioned as one of the solutions to decongesting Metro Manila as several government agencies would be relocated there and are among the priority projects in the government’s infrastructure plan.

The planned community spans 9,450 hectares and is estimated to house up to 1.12 million people.

The first phase of the development covering 60 hectares will feature the National Government Administrative Center, where at least 21 government offices are currently being considered for relocation to Clark.

It will also include back-up offices of various government agencies and a world-class sports complex being constructed in time for the 2019 Southeast Asian Games.

Meralco owns a 60 percent equity stake in the consortium, Marubeni  (20 percent), Kansai Electric Power and Chubu Electric Power (10 percent each).

Meanwhile, the special purpose company put up by the consortium with the BCDA will be 90 percent owned by the private partners and the balance  by the state-run firm.