Meralco seeks ERC OK for P20.8 B capex

Manila Electric Co. (Meralco) is seeking regulatory approval for its increased capital expenditure (capex) this year.

Meralco has filed an application with the Energy Regulatory Commission (ERC) for its proposed P20.79 billion capex for regulatory year (RY) 2019, which starts on July 1, 2018 to June 30, 2019.

The capex proposal covers 27 major projects totaling P8.51 billion and 84 residual projects amounting to P12.28 billion.

“Meralco’s RY 2019 capex program is geared towards providing reliable service to its customers by creating an adequate, safe, efficient, and viable distribution network, while providing the needed capacity to address the forecasted load growth within its franchise area,” the company said.

For the period covered, the power distributor said it is forecasting a 4.3 percent growth in peak demand and a 3.6 percent growth in its customer base. As of end-March, Meralco counts 6.4 million customers.

Among the major projects, the largest amount is allotted to the expansion of its advanced metering infrastructure at P2.38 billion.

“Automation/technology projects will allow Meralco to enhance its distribution network, enabling it to respond more effectively and efficiently to line and network outages, which will reduce service interruptions of customers,” Meralco said.

Major projects also include the development, expansion and upgrade of substations. It also includes the relocation of Meralco’s electrical facilities affected by the construction of the national government’s public-private partnership (PPP) projects.

“The national government has identified the implementation of public- private partnership programs and projects as a cornerstone strategy of the national development plan to accelerate the infrastructure development of the country and to sustain economic growth. Meralco would thus need to relocate existing facilities so as not to hamper the construction and development of these critical PPP projects,” the power distributor said.

Meanwhile, capex for residual projects are required to maintain existing assets, improve network performance and enhance customer service performance in the current regulatory period.

Earlier, Meralco president Oscar Reyes said the company earmarked a higher capex this year to meet the requirements of its growing customer base and increasing power demand within its franchise area, as well as to ensure resilient and hardened network to be able to meet the changes in climate.

Last year, Meralco sought P18.36 billion in capital capex to expand and upgrade its network in RY 2018 – which starts on July 1, 2017 and ends on June 30, 2018 – and has yet to be cleared by the power regulator.

In 2016, Meralco earmarked P17.5 billion to P18.5 billion in capex but the ERC approved lower capital spending at P15.4 billion.