The Manila Electric Company (Meralco) is currently negotiating with power producers in establishing a 300-megawatt supply agreement to cover mid-merit requirements.
“I think for our baseload, we are sort of already contracted. We are in discussions for our mid-merit for gas,” Meralco president Oscar Reyes said.
The power distributor said that it prefers natural gas and geothermal plants for mid – merit capacity. The generating capacity is to fill the gap between peaking and baseload power plants.
“It can also be some other mid-merit plants [aside from gas], because you can have a mid-merit geothermal,” Reyes said.
The power supply contract was aimed to be finalized by the first half of 2017, Reyes said.
In April, Meralco signed around 551 megawatts of power supply agreements with seven power companies. However, only one agreement has been approved to date.
The Energy Regulatory Commission (ERC) approved Merlaco’s supply agreement with Panay Energy Development Corp where it will source 70 MW from the power company. Panay Energy owns a 150 MW coal fired power plant in Barangay Ingore, La Paz, Iloilo. The power plant was expected to go online on August 26.
Panay Energy is a subsidiary of Global Business Power Corp and is expected to supply 70 MW starting February 26, 2017.
225 MW of power with Redondo Peninsula Energy Inc is one of the pending supply agreements. RP Energy, which is majorly controlled by the Meralco PowerGen Corp, is initially building a 300 MW coal plant in Subic, Zambales.
Meralco also has a pending 400 MW supply agreement with St. Raphael Power Generation Corp. The power producer is looking to establish a 700 MW coal-fired plant in Calaca, Batangas.
Mid – Merit power plants’ production can be adjusted based on demand. These plants are older and less efficient, and may be pricey to run full time.