The Manila Electric Co. (Meralco) has obtained a one-year emergency power supply agreement (EPSA) with San Miguel Corporation’s South Premiere Power Corp. (SPPC) for the supply of 300 megawatts (MW) baseload capacity until March 25, 2024.
The company said the EPSA a two-part tariff composed of a P1.75 per kilowatt hour fixed cost and a variable cost indexed on fuel price movements.
Meralco said the agreement was pursued in the wake of a Department of Energy (DOE) certification exempting the EPSA from the competitive selection process (CSP). The transaction also partially replaces the capacity covered by the company’s 2019 PSA with SPPC which was subjected to a writ of preliminary injunction issued by the Court of Appeals.
Meralco said the EPSA should help shield consumers from volatile and potentially higher generation costs at the Wholesale Electricity Spot Market that historically sells more expensive electricity during the dry season when power demand spikes.
Apart from the EPSA, Meralco is also seeking DOE approval of another EPSA involving 180 MW baseload capacity meant to further boost available supply.
The proposed 180 MW supply had been subjected to two rounds of CSPs that both failed due to lack of bidders.
Meralco said the proposal is similarly filed as another EPS as the country moves towards the dry months when demand rises as temperature climbs.
