Meralco plans to bid out 250-MW peaking power

Manila Electric Co. (Meralco) is eyeing to conduct a competitive bidding for nearly 250-megawatt (MW) of capacity to augment peaking power supply in its franchise area in time for summer of 2016.

The country’s largest power distributor has received three proposals for peaking power supply, which will be put for a price challenge, Meralco president Oscar S. Reyes told reporters in an informal briefing.

“We’re publishing a price challenge for an interim power supply agreement in the order of about 245 MW,” he said.

The three power firms that submitted unsolicited proposals are Toledo Power Corp. for 28 MW, Panay Power Corp. for 45 MW and 1590 Energy Corp. for 170 MW, for a total of 243 MW.

Meralco will publish an invitation for price challenge and will be accepting offers until Dec. 28.

The supply will cover the February to July period, specifically the trading intervals 10 a.m. to 9 p.m. from Mondays to Saturdays.

“Whoever gets it, we will enter into interim PSA,” Reyes said.

The agreement will commence once the Energy Regulatory Commission (ERC) approves the deal and will expire on Feb. 27, 2017, which can be extended for up to three years.

The auction is part of the distribution utility’s way of complying with the Energy department’s directive of conducting competitive selection process (CSP), the company’s top official said.

“We try to work within the [CSP] framework to see if it works,” Reyes said.

Earlier this month, Meralco chairman Manuel V. Pangilinan said the company will no longer pursue a legal case against the implementation of the CSP.

Last Nov. 4, the ERC issued the go-signal for distribution companies and electric cooperatives to conduct the controversial competitive bidding to generation companies to secure supply contracts for their captive markets.