Department of Energy Secretary Alfonso Cusi is eyeing more investments in merchant power plants to spur competition in the electricity spot market.
The energy secretary is encouraging investors, especially foreign, to establish merchant plants – or plants that sell their outputs to the wholesale electricity spot market.
“We want real investors willing to take (on) the business and they will cater to the spot market with the intent to, of course, later on being able to enter a contract,” he said.
He added that it is timely to invest in merchant plants as the country has a strong growth trajectory and there are more than enough plants coming in the next few years.
“The only encouragement is they have to believe in the Philippine economy…which is said to be the fastest growing in the region. Any business man believing in that will be willing to be test,” Cusi said.
DOE will also undergo a study to raise the WESM’s contribution to the country’s power supply to 20 to 30 percent.
“We are looking at 20 to 30 percent (from) merchant (plants),” Cusi said. “As a secretary, it’s very important for me to have the PEMC working because of the policy we are implementing.”
The country’s power supply comes from 90 percent bilateral contracts between power generators and distribution facilities.
The current merchant plants in the country include the 98 megawatt (MW) Avion and 414 MW San Gabriel gas plants of the Lopez group; The 103 MW Mapalad Power Corp (MPC), the 100 MW Western Mindanao Power Corp (WMPC) and the 55 MW Southern Philippines Power Corp. (SPPC) of the Alcantara group.