MANILA, Philippines – Power distribution giant Manila Electric Co. (Meralco) expects sales volume growth to slow starting May due to cooler temperatures with the onset of the rainy season.
However, company officials expect strong customer growth and business appetite to temper the impact of cooler weather on electricity sales.
In a briefing yesterday, Meralco president and CEO Oscar Reyes said the power distributor performed well in the first four months of the year
given the extremely hot weather due to El Nino phenomenon.
The company ended the first four months of the year with a 12.1 percent rise in sales, said Alfredo Panlilio, Meralco SVP and head for customer retail services and corporate communications.
But with the onset of the rainy season, energy sales in the ensuing months will be tapered, Reyes said.
“We will not see the same growth in terms of peak demand, in terms of energy sales as we’ve seen in the first four months. But it’s too early to say how much the impact of weather would be,” he added.
Despite the cooler weather, Panililio said energy sales could be anywhere between three percent and 12.1 percent owing higher customer count and new businesses coming in.
“There might be an impact on sales because of the temperature, but it’s too early to say [at] what [level] it will end up by year-end, surely lower but hopefully not too low because of [the good] economy. There are new hotels coming up, there’s a new cement plant of Eagle Cement that has been put into stream, there is Tiger Resorts coming in in the last quarter,” Panlilio said.
“There are a lot of new customers coming in, big and small, and that might still push growth. Temperature will definitely have an impact especially on the residential segment. We may not see 12.1 percent but maybe won’t see three percent, but maybe it’s somewhere in the middle,” he added.
To meet its growing customer requirement, Meralco is looking at borrowing P10 billion to 1P5 billion from local banks to bankroll its capital expenditures for this year and next year, company SVP and CFO Betty Siy-Yap said in the same briefing.
Meralco earlier withdrew its application from the Energy Regulatory Commission (ERC) for the issuance of bonds due to increasing interest rates.
“While we have the cash, there is also a need for us to borrow… we are exploring other options,” she said.
“We’re still talking with banks on how to structure it. In the mean time, we can use our internally generated funds,” Siy-Yap said.