Meralco to apply for P20-B capex next year

Power utility giant Manila Electric Company (Meralco) will apply for capital expenditures (capex) of P20 billion to bankroll projects for network expansion, reinforcement of its network reliability as well as targeted massive-scale rollout of smart meters.

Atty Jose Ronald V. Valles, first vice president and head of regulatory of Meralco, stated that the capex application will be filed with the Energy Regulatory Commission (ERC) next week.

“We’re targeting to file that next week, that’s for the RY (regulatory year) 2021 already,” he told reporters during a virtual press briefing.

Valles expounded that the capital outlay shall underpin the utility firm’s “load growth and the usual network reliability improvements…and we’re also looking for capex requirements for smart meters to address the situations which happened recently,” referring to the “estimated billing” resorted to during the lockdown period that subsequently resulted in overwhelming complaints from consumers.

The initial deployment of smart meters in the firm’s capital outlay next year will be for 100,000 meters – and it may cover both prepaid and post-paid subscribers.

In the longer term, the rollout shall be ramped up to 1.0 million meters in the next three years; and a wider base of 3.3 million smart meters in eight years.

Meralco is leaning on the deployment of advanced metering infrastructure or AMI, which is in the genre of “intelligent meters” that could then perceptively guide consumers on managing their usage based on what would really fit their budgets.

The smart meters could also spare consumers from billing confusion akin to what happened in the April-May billings of Meralco when its meter readers were not physically able to go on field for meter reading – that will be so because there is already direct information available in the smart meters that could then be fed forward into the information technology (IT) system of a power utility.

In the first six months of this year, Meralco reported that it already spent P6.9 billion of its consolidated capex for key projects, primarily those that are supporting the Build, Build, Build (BBB) infrastructure development program of the government.

Meralco First Vice President and Head of Networks Ronnie L. Aperocho said “we’re gaining momentum in our capex execution despite the numerous challenges and we have already utilized 51% or P4.76 billion out of our reduced capex of P9.34 billion budget for the year.”

The major capex spending of the utility firm had been for: new connections at P2.42 billion, which accounted for 84-percent of the firm’s P2.88 billion budget; then P1.12 billion for maintenance and asset renewals; and P780 million for load growth and residual utilization of non-network BBB and Meralco electrification projects.

He further noted “we expect higher utilization of BBB-related projects for second half of this year, and we’re working closely with different stakeholders, especially DPWH (Department of Public Works and Highways) and DOTr (Department of Transportation),” the key implementing agencies of the State’s infrastructure undertakings.

The power firm similarly spent roughly P80 million in fast-tracking the energization of the Covid-19 quarantine and treatment facilities within its franchise area.