Meralco sees sales turnaround in 2015

Manila Bulletin
by Myrna Velasco
September 21, 2014

Amid threats of rotating power outages, mammoth power utility firm Manila Electric Company (Meralco) is optimistic of boosting its energy sales to 4.0-4.5 percent in 2015, a turnaround from this year’s slower 3.0 percent growth, on corresponding growth in demand.

“We are looking at a growth in demand of 4.0 to 4.5-percent next year,” Meralco president and chief executive officer Oscar S.Reyes has noted. Reyes said the growth forecast corresponds to its projected growth in demand.

He added that it will be some sort of turnaround from this year’s tamed sales growth of just 3.0-percent due to convergence of factors that had slowed down demand.

“Because this year, there have been events that had tempered demand … in addition we had comparatively cold summer and then we had the effects of Typhoon Glenda,” Reyes stressed.

From the setbacks it encountered in year 2013 on the pricing front as well as on social perception, Meralco has been reinforcing its contingency measures so it can keep pace with customer expectations for better service delivery and more acceptable cost impacts.

The major challenge to its load network and onward to meeting customers’ needs, according to the utility firm, had been anticipated generation deficiency due to the increasing frequency of outages in power plants.

These factors, the company added, have been “exerting pressure both on the availability of supply as well as on price.”

Reyes has reiterated that “the insufficient generating capacity and reserves required to serve a growing electricity market in the Luzon grid have been exacerbated by the reduced availability of the existing power plants and relatively higher frequency of forced outages of power plant units of varying durations.”

The utility firm itself has logged 21 incidences of power plant forced outages in November-December last year, a monumental period for the energy sector because that was also the time when the Malampaya platform, the country’s major source of gas supply for its power plants, had been on maintenance shutdown.

The behemoth power distribution firm has long been programming investments for it to become part of the country’s power supply solution. However, challenges up to judicial interventions, have snagged implementation timelines on its proposed power projects.

Meralco chairman Manuel V. Pangilinan similarly asserted previously that “the lack of reliable generating capacity to meet growing demand, which has become more evident since November 2013, remains to be the major challenge to power supply and pricing stability.” source