ERC eyeing to review impact of $3.3-billion LNG agreement
THE ENERGY Regulatory Commission (ERC) said it will review the potential impact of the agreement among three energy companies to operate an integrated liquefied natural gas (LNG) facility on the power industry.
“We will review once we have more information, particularly regarding the results of recent CSPs (competitive selection processes) of Meralco (Manila Electric Co.) and pursuant to other mandates of the Commission,” ERC Chairperson Monalisa C. Dimalanta told reporters on Monday.
Ms. Dimalanta made the statement when sought for comment on the deal among San Miguel Global Power Holdings Corp. (SMGP), Meralco PowerGen Corp. (MGen), and Aboitiz Power Corp. (AboitizPower).
Under the $3.3-billion deal, MGen and AboitizPower will jointly invest in two of SMGP’s gas-fired power plants: the 1,278-megawatt (MW) Ilijan power plant and the new 1,320-MW combined cycle power facility.
The three companies will also invest in the LNG import and re-gasification terminal owned by Linseed Field Corp.
MGen is a subsidiary of power distributor Meralco while SMGP is a subsidiary of conglomerate San Miguel Corp.
“The review of the merger falls under the mandate of the PCC (Philippine Competition Commission). ERC will review the effect, if any, on the present and future PSAs (power supply agreements) of Meralco and behavior of players in the WESM (Wholesale Electricity Spot Market) and retail market,” she said.
“There has been a standing arrangement for coordinated review since 2019. We just operationalized the agreement by setting up the joint inquiry team last month,” she added.
The ERC and the PCC said last month that a joint task force was formed “to monitor and investigate allegations of anticompetitive practices in the power sector.”
Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc.
Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls. —