Meralco secures best offer for 170-MW summer supply

MANILA, Philippines — Manila Electric Co. (Meralco) has received the best offer for its 170-megawatt (MW) summer supply from San Miguel Corp. (SMC) unit, South Premiere Power Corp. (SPPC).

Meralco, through its Third-Party Bids and Awards Committee (TPBAC), said SPPC submitted the lowest bid for the contract to supply 170-MW peaking power through a competitive selection process (CSP) held yesterday.

TPBAC, which oversees the CSP, declared SPPC’s offer of P6.8198 per kilowatt-hour (kWh) as the best bid. The offer was below the P7.2989 per kWh total delivered headline reserve price.

The total delivered headline rate includes value-added tax (VAT) and other charges.

Global Business Power Corp., through its subsidiaries Panay Energy Development Corp., Toledo Power Co. and Panay Power Co., submitted a P9.7777 per kWh offer, which exceeded the reserve price set for the bidding.

Therma Luzon Inc. initially expressed interest but withdrew its participation in the CSP round.

“Upon the issuance of a notice of award, Meralco will enter into a power supply agreement with SPPC, which will then be submitted for approval by the Energy Regulatory Commission. This power supply agreement will help ensure availability of supply, which is especially critical in the upcoming dry months and the national and local elections,” Meralco head of Regulatory Management Office Jose Ronald Valles said.

The TPBAC said the committee’s findings were based on a pass/fail assessment of the qualification documents for completeness. It will now conduct a post-qualification evaluation prior to the issuance of the notice of award.

“The TPBAC complied with its mandate to conduct the bid in an open and transparent manner to achieve the least cost of electricity, in accordance with the Department of Energy’s Circular 2018-02-0003 on CSP, TPBAC chairman Ferdinand Domingo said.

CSP round, which involves a contract from Feb. 26 to July 25 is part of Meralco’s preparations to ensure that there will be sufficient, reliable and cost-competitive supply for the summer months when demand is historically high.

Meanwhile, Meralco is also awaiting the DOE’s approval of the TOR for another CSP covering 180-MW supply needed this coming summer.

The baseload capacity from the 180-MW CSP is aimed at replacing the reduced supply from gas-fired power plants due to the Malampaya gas restriction.