(The Philippine Star) | Updated February 18, 2013 - 12:00am
MANILA, Philippines - Manila Electric Co. (Meralco), the country’s biggest power distributor, is seeking an extension of its transition supply contract with the National Power Corp. (Napocor) to secure adequate power supply for its over five million customers.
Meralco president and chief executive officer Oscar Reyes said the company is in talks with the Power Sector Assets and Liabilities Management Corp. (PSALM), the government corporation in charge of Napocor, for the extension.
“We’re working for an extension with PSALM,” he said.
The TSC with Napocor expired in December last year but this was extended for another two months. Meralco is seeking to extend the contract to June 25, 2013.
Under the proposed extension, Meralco is seeking an additional 100 megawatts.
Reyes said the extension would be beneficial for all concerned parties – electricity users, Meralco, Napocor and PSALM.
“This request is going to be beneficial to over five million households and industrial and commercial customers who will be less exposed to the WESM (Wholesale Electricity Spot Market) during higher price summer months and at the same time, its a win-win situation for everyone, because it benefits PSALM and Napocor,” Reyes said.
Meralco buys a significant portion of its power requirements from Napocor through the TSCs.
To replace the expiring TSCs, Meralco has contracted up to 2,800 MW of power supply for the next seven years from private generators.
This would help ensure that Meralco will rely less on expensive electricity in the WESM.
The new supply deals, together with Meralco’s other bilateral contracts, account for about 95 percent of the requirements of Meralco customers in 2013.
The expiration of the TSC coincides with the implementation of the open access regime. Under this environment, large power users can choose their own suppliers and is expected to bring down rates of large customers due to market competition.
The full implementation of the open access regime is set on June 26, 2013. source
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