"We hope that Meralco and Quezon Power Philippines Ltd. (QPPL) will be able to soon finalize negotiations of their power supply contract to further reduce electricity rates of Meralco’s customers," Perez said.
Perez noted that negotiations between private distribution utilities such as Meralco and their own IPPs constitute the second and last phase of the review of existing IPP contracts.
This follows the mandated review of the National Power Corp. (Napocor)’s contracts with its own IPPs.
He said settlement between Napocor and its IPPs involving 25 contracts has generated a total of $1.03 billion in savings in net present value to the government, thus reducing future power generation costs.
The energy official also expressed satisfaction on the announcement by Meralco that it has finalized amendments with its sister company, First Gas Power Corp. (FGPC) on their power supply contract.
"We welcome the efforts of Meralco and FGPC to revise their power supply contract to bring down the cost of power generation from their end and eventually reduce the price of electricity to the end-users," he said.
Meralco has announced this week that it has signed a new contract with FGPC resulting in savings of about three centavos per kilowatthour (kwh) in electricity rates.
Perez said the Department of Energy has been working and consulting with Meralco’s Independent Review Committee led by its chairman Margarito Teves to help find ways to reduce power costs within the Meralco franchise area.