By Lenie Lectura - June 6, 2019
SMC Global Power Holdings Corp. has
advised the Manila Electric Co. (Meralco) to start the competitive selection
process (CSP) that involves two new power plants with a combined capacity of
over 1,000 megawatts (MW).
“We submit ourselves to CSP. We have
already advised Meralco na umpisahan na ang CSP. I think everybody will
abide. For me, whatever they do, we will join the bidding. At the end of the
day, the lowest price wins. We wait for Meralco to call for a CSP. Meralco has
changed leadership, so we will wait,” SMC President Ramon Ang said.
The CSP is a mechanism to ensure
transparency and fair competition in the procurement of power supply between a
distribution utility (DU) and a power-generation firm.
The power arm of the conglomerate
and Meralco earlier signed two power-supply agreements (PSAs) via bilateral
negotiations. However, these two are among the 90 PSAs covered by the Supreme
Court ruling last month.
The SC has ordered all PSAs
submitted by DUs to the Energy Regulatory Commission (ERC) on or after June 30,
2015, to undergo CSP in accordance with a 2018 Department of Energy circular.
The two PSAs are the Central
Luzon Premiere Power Corp. (528 MW) and the Mariveles Power Gen. Corp. (528
MW). These two power plants are supposed to partly supply Meralco’s
requirements for 20 years.
Ang said each power plant would have
four units of 150 MW each. These are still up for development As a rule of
thumb, one MW costs P2 million. “These are Circulating Fluidized Bed plants in
Bataan and Quezon. We will arrange for new funding for the plants,” he said.
As indicated in the 2018 DOE CSP
circular, the DOE will closely oversee the competitive bidding process to
guarantee that the exercise is conducted in an open, transparent, effective,
efficient and equitable manner. For its part, the ERC will work alongside the
DOE by enforcing and implementing the relevant policies formulated, as well as
all pertinent rules and regulations issued by the DOE. However, should the
process grossly fail, the DOE will not hesitate to enact all necessary measures
to uphold the integrity and completion of the CSP.
“In adherence to the SC’s judgment,
we call for the exigent conduct of CSP for the PSAs of DUs, which include
electric cooperatives and private corporations like Meralco. Power development
in our country, particularly in Luzon, has been at a standstill for three
years. We can no longer afford any further delay. We need to act now with
extreme urgency to make up for the lost time,” Energy Secretary Alfonso Cusi
said.
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