Power utility giant Manila Electric Company (Meralco) will be undertaking fresh round of competitive selection process (CSP) to auction power supply agreements (PSAs) covering 1,100 megawatts for its baseload and mid-merit power requirements.

Atty. Jose Ronald Valles, first vice president and regulatory affairs head of Meralco, noted the bidding process will be carried out this year upon the approval of the Department of Energy (DOE) of its newly proposed CSP to cover its supplemental power supply needs.

“There are some CSPs that we will undergo this year. These are the 500MW mid-merit; and another one is the 600MW baseload – that’s based on the PSPP (power supply procurement plan) timeline that we have submitted to the DOE,” he said.

The targeted CSPs will be on top of the 180MW capacity that the utility firm is eyeing to purchase primarily to augment its supply portfolio this year; and its solicitation of 850MW mid-merit supply that shall be underpinned by renewable energy (RE) facilities.

The off-take for the RE supply, in particular, has been anchored on the unsolicited proposal lodged by Terra Solar, a joint venture of Razon-led Prime Infrastructure Capital Inc. and Solar Philippines.

The initial round of auction for that RE-based mid-merit capacity procurement failed, hence, Meralco opted to conduct another round of bidding with the submission of expressions of interest (EOIs) slated on May 2 this year.

Two challenger-firms - the consortium led by SunAsia Energy Inc. and SMC Global Light and Power Corporation (SGLP) – had been expected to put up tenders that should have challenged the 2,400MW solar and 4,000-megawatt hour (MWh) battery storage facilities submitted by Terra Solar.

Nevertheless, on the actual auction date, the prospective bidders failed to submit their respective offers, hence, the PSA bidding was declared a failure. That then prompted the third party bids and awards committee (TPBAC) of Meralco to schedule another round of auction and the final submission of expression of interest will be on May 2 this year.

Meralco has not given any pronouncement yet if ‘negotiated deal’ could be the next recourse if the second round of bidding would still fall through.

The country’s biggest power distribution company has not just been reinforcing its supply portfolio on this year’s summer months – but also its medium and long-term electricity requirements.

And in keeping with the ‘energy transition pathway’ being pushed by the government under the updated Philippine Energy Plan (PEP) and on the mandated compliance to the Renewable Portfolio Standards (RPS) policy, Meralco has likewise been fortifying its power procurement strategy by integrating RE through its CSP activities on cornering power supply deals.

According to Meralco, peak demand growth in its system has already been at 2.2-percent last year when some businesses started accelerating on their re-opening post-Covid.

“As economic activity resumes, from 2021 to 2030, peak demand is expected to grow annually by an average of 4.1-percent per year,” Meralco said, albeit it emphasized that “peak demand will also be affected by how much RE are introduced into the power system.”