Lopez Group tapping RE assets to supply 100 MW to Meralco

By Lenie Lectura - September 20, 2019

https://businessmirror.com.ph/2019/09/20/lopez-group-tapping-re-assets-to-supply-100-mw-to-meralco/

THE power arm of the Lopez group said Thursday it will source power from its geothermal and hydro assets for the 100 megawatts (MW) of capacity that will be supplied to the Manila Electric Co. (Meralco) starting December 26 this year.

“The Lopez group’s renewable-energy [RE] portfolio composed of its First Gen Hydro and its Energy Development Corp. [EDC] geothermal facilities will soon supply 100 MW of clean, renewable, reliable power to Metro Manila after it won in the Meralco Competitive Selection Process [CSP] for 500-MW mid-merit capacity for five years beginning on December 26, 2019,” said EDC in a statement on Thursday.

The power-supply agreement (PSA) was signed with Meralco last September 16.

First Gen Hydro, the group’s contracting arm that is 60-percent owned by EDC and 40-percent owned by First Gen Corp., was able to offer a lower all-in headline rate of P5.1908 per kilowatt-hour and computed all-in Levelized Cost of Energy (LCOE, VAT inclusive) of P5.3989/kWh compared to other competing coal companies.

“Winning this contract is a clear indication that clean, renewable energy, especially one that is baseload or available 24/7 like geothermal, can be priced lower versus carbon-intensive, nonrenewable-energy sources,” said EDC President and COO Richard B. Tantoco. “This gives power consumers a more compelling reason to decarbonize our economy by transitioning to RE.”

Power will be supplied by First Gen Hydro and EDC’s Nasulo, Tongonan, and Bacon-Manito geothermal facilities.

EDC’s 1,475-MW capacity accounts for 37 percent of the country’s total generated renewable energy, making it the country’s leading RE company. Its 1,181 MW of geothermal portfolio, which accounts for 61 percent of the country’s total installed geothermal capacity, has put the Philippines on the map as the third-largest geothermal producer.

Meanwhile, one of the parties who opposed Meralco’s seven PSAs earlier nullified by the Supreme Court, urged Meralco to include Meralco customers in the CSP.

“We insist that Meralco’s residential customers have the highest priority in TPBAC [Third Party Bids and Awards Committee] representation. We are the most in numbers at over 6 million. We paid two-thirds of Meralco’s revenues but consumed only one-third of the energy sold,” said Romeo Junia in a statement.

“Commercial/industrial customers, on the other hand, contributed only one-third of revenues but consumed two-thirds of energy. In the Meralco franchise, commercial/industrial customer is consumer king; residential customer is revenue slave,” he added. CSP is mandatory for all distribution utilities after the SC nullified the ERC orders that delayed the implementation of CSP and unduly benefited the utilities. Meralco’s seven supply contracts covering 3,551 MW were among 90 PSAs nullified by the SC order.

“While observers may be invited by TPBAC under the DOE rules, that invitation is limited to DOE itself and ERC only, leaving residential customers no access to relevant documents, records and other submissions when intentionally left out of TPBAC,” added Junia.