Business Mirror
Published on Thursday, 03 January 2013 18:26 Written by InterAksyon.com
POWER retailer Manila Electric Co. (Meralco) has tapped Aboitiz Power Corp to provide the balance of its electricity requirements that had been unfilled after a contract with the government expired last year.
In a disclosure to the Philippine Stock Exchange, Manila Electric Co. said it executed a power supply agreement with Therma Luzon Inc. (TLI) and AP Renewables Inc (Apri), both of which are subsidiaries of AboitizPower.
“The power supply agreements were executed to cover the volume needed by Meralco during the six-month transition period before the start of the commercial operations of open access and retail competition,” the country’s largest power distributor said.
Under the supply deal, Meralco will source electricity from TLI’s Pagbilao coal plant and Apri’s Tiwi-Makban geothermal plant until June 25, 2015, subject to the approval of the Energy Regulatory Commission.
The power supply from AboitizPower will cover Meralco’s remaining electricity requirements that used to be covered by state-owned National Power Corp.
Under the Electric Power Industry Reform Act of 2001, Meralco’s contracts with Napocor are to expire with the implementation of open access in the power sector, which would allow consumers to choose their suppliers.
Meralco earlier inked roughly 4,800 megawatts of supply contracts with coal plants operated by subsidiaries of AboitizPower, San Miguel Corp, DMCI Holdings Inc and AES Corp.
Despite these contracts, Meralco was still short by 200 megawatts.
“The objective is to try to limit the potential sourcing from WESM,” Oscar S. Reyes, Meralco president and chief executive officer, said.
The Wholesale Electricity Spot Market is a trading platform where power plant operators trade their excess capacity, which refers to electricity not tied up to supply contracts. Since WESM prices are subject to demand-supply conditions, they tend to be volatile, thus causing wild swings in the rates of distributors that tap the trading platform.
(InterAksyon.com) source
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