The Manila Electric Company (MERALCO) will be opening yet another round of competitive selection process (CSP), this time to auction power supply agreements covering 1,100 megawatts (MW) worth of baseload and mid-merit power requirements.
The baseload contract covers 600MW of the requirements, while the mid-merit contract covers 500MW. MERALCO FVP and regulatory affairs head Atty. Jose Ronald Valles said in a Manila Bulletin report. The capacities are based on the company’s power supply procurement plan submitted to the Department of Energy (DOE).
MERALCO’s new CSPs will be on top of those for its 180MW interim baseload and 850MW renewable energy (RE) mid-merit capacity requirements, both of which are undergoin a second round of auctions. The first round of auction for the 850M supply was declared a failure as the power giant did not receive bids to challenge the unsolicited proposal of Terra Solar – the joint venture of Leandro Leviste’s Solar Philippines and Enrique Razon’s Prime Infra.
MERALCO is currently awaiting approval from the DOE on its proposed CSPs to cover its supplemental power supply needs.
The company is strengthening its power procurement strategy by integrating RE in its CSP activities in compliance with the Philippine Energy Plan and the mandated compliance with the Renewable Portfolio Standards.
Data from MERALCO shows that the peak demand in its system grew by 2.2% last year, as businesses reopened after easing of restrictions amid the COVID-19 pandemic. The power giant added that peak demand is seen to grow by an average of 4.1% a year from 2021 to 2030, and it will also be affected by how much RE is introduced into the power system.
Meanwhile, MERALCO has another power supply agreement (PSA) with SMC Global Power Holdings for the supply of 170MW, which would supposedly be utilized in anticipation of the thinning of operating margins leading up to the May 9 elections. The PSA, which was supposed to run from February 26 to July 25, will be the subject of a public hearing by the Energy Regulatory Commission on May 6 and 13.