The Department of Energy (DOE) has set a new policy aiming to protect consumers from the impact of maintenance shutdowns, which are scheduled and are not meant to create price shocks.
In a briefing, DOE Undersecretary Felix William Fuentebella said DOE wants to prevent consumers from shouldering higher fuel costs when the Malampaya gas facility schedules its maintenance in the future.
The agency said they will look into the contracts of Malampaya gas facilities, power plants, and distribution utilities.
“We will look into these contracts and we will coordinate and we will ask their inputs on how to address the policy of Secretary [Alfonso] Cusi because scheduled maintenance is scheduled, meaning, it is foreseeable. so there should be no price shock,” Fuentebella said in a briefing.
“We’re willing to explore opportunities to work with the DOE and power users. Our interest is how we deliver gas safely, reliably and efficiently,” Shell Philippines Exploration Corporation (SPEx) managing director Don Paulino said in the same briefing.
On the other hand, Manila Electric Co. (Meralco) said any agreement should work with the contracts signed by parties involved.
“This involves several agreements from the consortium to the power plants. We have to look at all those arrangements. And whatever we agree upon, it should pass the legal test,” Meralco senior vice president and head of utility economics Larry Fernandez said.
During the 20-day Malampaya maintenance shutdown from Jan. 28 to Feb. 16, power rates were expected to increase since natural gas plants used other fuel sources like diesel, which are more expensive.
Meralco filed an application with the Energy Regulatory Commission (ERC) on January 31 for a total rate hike of P0.9174 per kilowatt-hour from March to May for the staggered recovery and payment of the generation charge.
Instead, the ERC provided a lower rate hike at P0.2211 per kWh spread from March to May.
*Photo from Pixabay