ERC allows interim relief for MEI

MANILA, Philippines – The Energy Regulatory Commission (ERC) has allowed Millennium Energy Inc. (MEI) to supply capacity to the grid using the distribution system of Manila Electric Co. (Meralco) without paying wheeling charges in the meantime to ensure supply in the Luzon grid.

The power regulator decided to grant MEI’s application for interim relief from paying Meralco’s wheeling charges, ERC chairman Jose Vicente Salazar said in a text message yesterday.

 “The Commission yesterday acted on Millennium Energy Inc.’s  application for interim relief by directing Meralco not to disconnect MEI from its distribution system and allowing the said plant to export its energy using Meralco’s distribution system pending resolution of the dispute resolution case filed by MEI,” he said.

The ERC also said MEI will only pay the actual dispatch until the power regulator resolves the issue between the two parties.

 “Moreover, for purposes of the distribution wheeling charges, the Commission decided that Meralco shall not impose a guaranteed minimum billing demand (GMBD) on MEI, in the interim, but shall only bill based on the actual use or dispatch of the MEI plant subject to ERC approved distribution wheeling charges,” Salazar said.

 “This resolution by the Commission is aimed at ensuring reliability and adequacy of supply in the Luzon grid,” he said.

Last month, MEI decided to rescind its distribution wheeling service agreement (DWSA) with Meralco due to high charge under contract.

This high charge, called wheeling charge or rate, is required to be paid by MEI under the contract since it will dispatch capacity to other distribution utilities (DUs) using Meralco’s distribution facilities.

MEI owns the 310-MW Navotas I and II gas turbine power plant at the Navotas Fish Port complex, which is part of Meralco’s franchise area.