Giant players in the domestic power industry will gear up for a new round of battle for their offers in the 400-megawatt capacity procurement of Manila Electric Company (Meralco) that will satiate mid-merit capacity in its supply portfolio.

Listed as prospective bidders in Meralco’s competitive selection process (CSP) or auction that will culminate on Oct. 1 would be First Gas Power Corporation and First Natgas Power Corp. of the Lopez-led First Gen Corporation; FDC Misamis Power Corporation of the Gotianun group; GNPower Dinginin Ltd. Co. of Aboitiz Power; then Masinloc Power Co. Ltd., and Sual Power Inc. of the San Miguel conglomerate.

This batch of capacity purchases will be underpinned by a 15-year power supply agreement (PSA) with a committed delivery date of Aug. 26 next year or upon the approval of the tariff pass-on by the Energy Regulatory Commission.

Meralco Bids and Awards Committee Chairman Lawrence S. Fernandez has cited the “continued interest of the country’s major energy players to join this CSP round that will help us ensure availability of least-cost supply for our customers starting next year.”

It is apparent that most of the interested parties in its next capacity contracting have been roughly the same entities which joined its recently concluded 600MW baseload capacity bidding.

This early, Meralco is already anticipating that the next tendering process will also succeed, with Fernandez asserting that “we look forward to the participation of these prospective bidders during the bid submission deadline and bid opening scheduled on Oct. 1.”

On the warranted power delivery, the CSP terms of reference (TOR) stipulated that supply shall be made available for 15 hours during Mondays to Saturdays – covering the peak hours of 9:00am to 12:00 midnight.

Then on Sundays, capacity delivery must be guaranteed for 10 hours within the peak hours of 2:00pm until 12:00 midnight.

Meralco qualified though that the delivery times “may change during the required contract period upon mutual consent of both parties.”

On bid submission, it was specified that the tariff shall be set two-tiered consisting of fixed and variable costs – and that shall be inclusive of separate line item proposal for line rental cap.

The bidding terms similarly prescribed that for a bidder whose nominated power plant feeds on gas; it must be clearly demarcated which portion of the fuel used for electricity generation had been sourced from indigenous natural gas.

In addition, the GenCo shall present “proof from its gas supplier of sufficient availability of the corresponding volume of such indigenous natural gas.”

The utility firm expounded that the bidder “shall submit supporting proof that there shall be no reallocation of indigenous natural gas currently being supplied to MERALCO’s existing power supply agreements” except in specified force majeure events.