‘ERC ruling on power deals should apply to all suppliers’
BY LENIE LECTURA – SEPTEMBER 15, 2022
from Business Mirror
ACEN Corp. said on Wednesday its power supply deal with the Manila Electric Co. (Meralco) should also be tweaked should the regulators decide to amend the power supply agreement (PSA) between Meralco and the power units of San Miguel Corp.
Phinma Energy Corp., which was renamed to AC Energy Philippines and later to ACEN Corp., won in the competitive auction to supply Meralco 200 megawatts (MW) for P4.7450 per kilowatt hour (kWh) for 10 years or until December 25, 2029.
“Whatever the decision will be, we hope that our regulator as well as Meralco, will treat all suppliers fairly and consistently. We have the same contract and similar sets of circumstances, so if there is a change in circumstance in one supplier, the same should apply to others,” said ACEN President Eric Francia.
Meralco, South Premiere Power Corp. (SPPC), and San Miguel Energy Corp. (SMEC) await the decision of the Energy Regulatory Commission (ERC) on the temporary rate relief petitions they filed.
SPPC has asked the ERC for a rate increase from January to May, of P0.80 per kilowatt hour (kWh) from P4.30 to P5.10/kwh for its 670 MW of contracted baseload capacity from the Ilijan plant, and an average of P4/kwh, from P4.30 to P8.30/kwh, for SMEC’s 330 MW contracted baseload capacity from the Sual plant.
The joint petitions cited steep coal prices, spiraling fuel prices amid the Russia-Ukraine war, and natural gas supply restrictions from the Malampaya gas field as reasons for the temporary relief. Coal prices averaged $176 per metric ton (MT) in the second half from just $99/MT in the first half of 2021. Average coal price in 2019 and 2020 was only at $69/MT. Coal prices have recently reached unprecedented levels, as high as $440/MT, as triggered primarily by the Russia-Ukraine conflict.
In the case of the Ilijan natural gas plant, questionable and unilateral notices of gas restrictions, which caused the deration or the ceasing of delivery of available capacity, had severely affected the plant’s net generation capacity, forcing it to source for costly replacement fuel from the Wholesale Electric Spot Market.
SPPC and SMEC are only seeking partial adjustment in price so the plants can continue supplying to Meralco.
