MANILA, Philippines — The Department of Energy (DOE) said Manila Electric Co. (Meralco)’s application to exempt its emergency power supply agreements (EPSAs) with generation companies from undergoing competitive selection process (CSP) is still under evaluation.
“As for the Meralco’s CSP exemption application, it is something that we are discussing with the power bureau at the moment and we will share with you as soon as this is going to be decided on,” Energy Secretary Raphael Lotilla said.
Meralco has been hoping for swift action from the DOE in exempting the EPSAs from undergoing the CSP.
Without the emergency supply deals, Meralco said its customers may become exposed to volatile prices should SMC Global Power Holdings Corp. decide to push through with the termination of its power supply agreements (PSAs) with the power distributor following the recent denial of their joint rate hike petition.
Meralco, however, said SMC Global Power has yet to formally issue a notice indicating that it wants the PSAs terminated.
As required in the Energy Regulatory Commission (ERC) orders denying the SMC and Meralco’s joint motions for price adjustment, any termination will take effect 60 days from the receipt of the said orders.
“The two PSAs that are subject of that petition, the one with South Premiere or the Ilijan power plant and with San Miguel Energy or the Sual power plant totaling 1,000 megawatts, continued to supply Meralco under the ERC-approved rates,” Meralco vice president and head of utility economics department Lawrence Fernandez said.
“Right now, we cannot dictate what SMC will do following the ERC ruling although they have told us that they will continue to supply under protest. But on the part of Meralco, we will try to preserve the PSAs for as long as possible,” he said.
Meralco reiterated that the company would exert all efforts and pursue all remedies under the contract and in law to preserve its PSAs with SMC Global Power.
“We would like to assure our customers that we will exhaust all remedies to prevent termination of the PSAs with South Premiere Power Corp. (SPPC) and San Miguel Energy Corp. (SMEC) since we believe that preserving these contracts will still be least-cost for our customers,” Meralco first vice president and head of regulatory management Jose Ronald Valles said.