Solar Phl to finish early solar plants under Meralco PSA

By Danessa Rivera (The Philippine Star) | Updated October 9, 2017 - 12:00am
http://www.philstar.com/business/2017/10/09/1746775/solar-phl-finish-early-solar-plants-under-meralco-psa

MANILA, Philippines — Solar Philippines will complete its solar power plants contracted to Manila Electric Co. (Meralco) ahead of the approval of the Energy Regulatory Commission (ERC) of the power supply agreements (PSA).

The company is building two projects contracted with Meralco, including a 50-megawatt (MW) solar farm in Tanauan, Batangas and another solar plant in Naic, Cavite.

“We purchased equipment as early as 2016 to comply with our Meralco PSA and will just sell to contestable customers if the PSA is still pending at ERC. The sooner the ERC approves this PSA, the sooner consumers can enjoy savings,” Solar Philippines president Leandro Leviste said.

The company said this would answer the call of the Department of Energy (DOE) to build merchant power plants to avert a power shortage next summer.

Solar Philippines said its Tanauan and Naic projects are among the first solar farms to be constructed after the end of the Feed-in-Tariff (FIT) with a rate of P8.69 per kilowatt hour (kWh) and the first to undergo a competitive selection process (CSP) at a rate of P5.39 per kWh.

“The fact these PSA’s are significantly below FIT, and emerged as the lowest cost in a CSP, affirms the competitiveness of these rates. Allowing the market to determine rates via CSP may be a solution to both lower electricity rates and ease the workload of ERC,” Leviste said.

The company official said hundreds of PSAs are said to be awaiting the approval of the ERC, with a growing backlog given the regulator’s limited manpower and resources.

“We have secured off-take agreements with private customers at higher rates than the PSAs now for ERC approval. If our PSA rates are reduced any further, we would be better off just selling to these private customers,” Leviste said.

Energy Secretary Alfonso Cusi earlier urged power players to build merchant power plants to cater to the spot market with the intent to later on being able to enter a power supply deal.

“Unless we act now, Filipinos may suffer power outages, if not higher rates next summer. While others await ERC PSA approval, we have proceeded with our projects to demonstrate our faith in our country’s economy and regulatory approval process,” Leviste said.