Meralco to start talks on RE power supply agreement

The Manila electric Co. (Meralco) will proceed to negotiate its 850 megawatt (MW) renewable energy power supply requirement following the failure of the second round of the competitive selection process (CSP) for Terra Solar Philippines Inc.’s unsolicited proposal.

“We have already started direct negotiations with the original proponent and intend to conclude it and sign the corresponding PSA [power supply agreement] for the 850-MW mid-merit requirement soonest,” said Jose Ronald V. Valles, head of Meralco’s Regulatory Management Office.

“The PSA will also form part of Meralco’s compliance with the DOE’S [Department of Energy] policy, the Renewable Portfolio Standards.”

The Third-party Bids and Awards Committee (TPBAC) said in its report that it did not receive any Expression of Interest from any prospective bidder by the May 2 deadline for Meralco’s mid-merit requirement.

The TPBAC further said that since there are no outstanding disputes on the first and second rounds of competitive challenge for the contract, the distribution utility may enter into direct negotiation for its 850MW contract capacity requirement, as provided by the Revised CSP Rules.

Terra Solar offered P6.0800 per kilowatt-hour (kwh) for headline rate and levelized cost of electricity. It proposed to supply Meralco 600 MW to be made available by February 26, 2026; while the additional 250 MW is expected to be delivered starting February 26, 2027.

It will source power from its planned solar power plants with Energy Storage System in Batangascavite, Bulacan, Nueva Ecija, Tarlac, and Zambales. These plants are under development.

During the first round of CSP, there were no comparative bids received even if two interested bidders initially expressed interest to participate in the bidding. The interested bidders are SMC Global Light and Power (SGLP) and Sunasia Energy Inc.

SGLP wrote and notified the TPBAC that it would no longer participate in the 850MW CSP. Sunasia, meanwhile, did not submit a bid but instead submitted and read a “Notice of Non-submission of Bid”.

Meanwhile, Solar Philippines Nueva Ecija Corp. (SPNEC) would soon own shares in Terra Solar once the asset-for-share swap is completed.

Earlier, SPNEC shareholders approved the increase in the company’s authorized capital stock to 50 billion shares from 10 billion shares, as well as the related share swap.

SPNEC’S share swap involves the issuance of 24.37 billion shares at P2.50 per share in exchange for shares of Solar Philippines in over 20 companies.

Once the asset-for-share swap is completed, SPNEC would own shares in Solar Philippines Calatagan Corp., Solar Philippines Tarlac Corp., Solar Philippines Tanauan Terra Solar Philippines, SP Holdings, Solar Philippines Batangas Baseload, Solar Philippines Central Luzon, Solar Philippines South Luzon, Solar Philippines Visayas, Solar Philippines Retail Electricity, Solar Philippines Rooftop and Solar Philippines Commercial Rooftop Projects Inc.

These hold 33 solar energy service contracts with the DOE, with an operational capacity of 169.36 MW and capacity under development of 14,395.03 MW or over two thirds of the total 21,302.32 MW across all DOE’S service contracts in the Philippines.