The Energy Regulatory Commission (ERC) will issue its decision on the rate hike plea sought by the San Miguel Corporation (SMC) and the Manila Electric Co. (MERALCO) on or before October 4.
In a report by BusinessWorld, ERC Commissioner Floresinda Baldo Digal said that the regulatory board is mindful of the timeline in SMC’s letter to MERALCO.
SMC Global Power Holdings Corporation (SMCGP) earlier said that it may terminate its two power supply agreements (PSA) with MERALCO on October 4 if no relief would be given by the ERC.
SMCGP and MERALCO earlier filed for a power rate hike in their PSAs after incurring a Php15 billion loss due to high global prices and natural gas supply restrictions.
San Miguel subsidiaries South Premiere Power Corp. (SPPC) and San Miguel Energy Corp. (SMEC) are the independent power producers (IPP) of the 1,200-megawatt (MW) Ilijan power plant, and the 1,200 MW Sual power plant, respectively.
SMCGP has applied for a Php 0.80 per kilowatt hour (kWh) hike for the 670-MW contracted capacity of the Ilijan plant, going from Php 4.30/kwh to Php 5.10/kWh. It also applied for an average Php4/kWh increase for the 300 MW contracted capacity of the Sual plant, going from Php4.30/kWh to as much as Php8.30/kWh.
The San Miguel energy arm warned that electricity prices may increase by as much as 30% beginning October should the PSAs be terminated.
MERALCO vice president and head of utility economics Lawrence Fernandez earlier said that its existing PSAs with SMC is the least cost option for consumers.
Fernandez added that MERALCO has contracted around four to five generations for emergency purchase of power, averaging Php7-8 per kilowatt hour for one year supply beginning October.