Wednesday, October 18, 2017

Meralco trims down sales-growth target



By Lenie Lectura -  

THE Manila Electric Co.’s (Meralco) latest expectation of this year’s energy-sales growth was trimmed to 4.5 percent, an official said on Tuesday.
Meralco President Oscar Reyes said on the sidelines of an executive seminar on Fostering Dynamic Competition in the Philippine Power Industry that 2017 sales volume may grow “slightly above 4.5 percent,” but will “not reach 5 percent because it was a weak first quarter.”
Last month Reyes said energy-sales volume could grow by “close to 5 percent” for 2017.
Reyes’s latest projection could be partly blamed on weak first-quarter numbers. He said that first-quarter sales growth was “very soft.” After which, it “started to gain a bit of momentum in the second quarter.”
From January to March this year, energy-sales volume grew to 9,317 gigawatt hours (GWh), or a growth of only 3 percent, over the same comparative period. This was brought about by a cooler temperature, an absence of the February 2016 leap-year effect, which is equivalent to approximately 100GWh lower energy sales, higher inflation, higher interest rates, a weaker peso and higher fuel prices, among others.
Last year Meralco’s sales volume grew by close to 8.8 percent at 40,142 GWh. He pointed out that sales growth last year was strong mainly on account of election-related spending, among others.
“We have to recognize that last year was a high-base year,” Reyes said.
Meralco is scheduled to announce its nine months financial performance next week.
“This quarter, we’ve been running at around 6 [percent] to 7 percent as we see growth in all sectors,” Reyes said. “We hope fourth-quarter projected sales will continue to be healthy.”
Reyes added July-to-September sales growth was fueled by strong demand across all sectors.
“If you go around, even in Metro Manila, you’ll see quite a number of developments—hotels, restaurants, real estate, retail trade, entertainment, semicon [are] doing well; basic metals are doing well; food and beverage also.”
The Meralco official had said there is a need to build up adequate capacity to address possible shortage in power supply because of rising demand.
“I think we don’t want to raise an alarm. It’s really just a realization that you’re better off with adequate capacity because it takes time to build. The yellow alerts are a reality,” Reyes said. “I think it just shows potential vulnerability of the entire system, and you are better with adequate capacity. If we cut it too thinly, and there are a bit of delays, then we’re going into a situation as we move to 2019 to 2022.”

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