The Energy Regulatory Commission (ERC) is scheduling next month the public hearings on the power supply agreement (PSA) of Manila Electric Company (Meralco) and South Premiere Power Corporation (SPPC) of the San Miguel group for the former's supplemental 170-megawatt power supply, especially for the May 9 elections.
The power industry regulator advised relevant stakeholders that the slated public hearings for the PSA application will be on May 6 and May 13 this year, timeframes that are already within the election period.
The ERC apprised industry players that “any interested stakeholder may submit its comments and/or clarifications at least one calendar day prior to the scheduled virtual hearing.”
In the joint PSA filing, Meralco emphasized that the delivered rate of P6.5398 per kilowatt hour (kWh), inclusive of value added tax (VAT) and line rental, “is lower by about P1.0016 per kWh than the effective cost of P7.5414 per kWh.”
With that power supply tariff then, the utility firm reiterated that its average blended generation rate will be reduced by about P0.0185 per kWh, resulting in savings to consumers of about P275.8 million.
The Meralco-SPPC application stated that the power supply deal has a "very competitive contract price for peaking capacity supply...such contract price is even lower than the previous offer received by Meralco for a peaking plant.”
The power firm cited that the other major features of the PSA that could benefit consumers, include “no outage allowance, and a guaranteed 100-percent availability of supply -- for 12 hours daily covering peak hours of Meralco – due to the financial-type nature of the PSA, which is crucial in the summer season of 2022.”
Meralco further noted that the approval of the PSA is critical because of the anticipated thinning of electricity operating margins heading up to the May 2022 elections, especially with the upcoming simultaneous scheduled maintenance and possible forced outages of power plants.
The utility company added the power supply pact can help shield Meralco’s customers from the looming supply deficiency because the supply availability of Meralco-SPPC PSA is "guaranteed 100-percent by SPPC and no outage allowance is provided.”
With the pleaded go-signal by the industry regulator, Meralco said a decision will “avert the situation where Meralco would be constrained to source its capacity deficit from the WESM (Wholesale Electricity Spot Market),” which in the process, would be exposing its customers to volatile power prices.