Meralco to hold bidding for 900MW supply needs

BY LENIE LECTURA – JULY 26, 2022
from Business Mirror

THE Manila Electric Co. (Meralco) will conduct more competitive biddings, possibly this year, for 900 megawatts (MW) of power supply requirement.

“Based on the approved PSPP [power supply procurement plan], we have the 200 MW baseload for RE (renewable energy) to comply with RPS [renewable portfolio standards] requirement. And another 100 MW, also baseload RE, and then there’s 600 MW conventional baseload also up for CSP [competitive selection process],” Meralco First Vice President Jose Ronald V. Valles said.

“But we haven’t approved it yet for submission to the DOE (Department of Energy),” Valles, who also heads the power utility’s Regulatory Management Office, added.

The capacities are aligned with Meralco’s submitted PSPP, the firm said. In terms of when the CSPs will be conducted for the total 900MW, this will depend on when Meralco will submit the Terms of Reference to the DOE for its approval, Meralco added.

When asked for tentative CSP schedules, Valles said these could be conducted “in the next few days or weeks or months, but this year.”

Also, Valles said, Meralco “may add emergency procurement but still being reviewed to determine the exact requirement.”

Meralco had just conducted a CSP via competitive challenge for the unsolicited proposal by Terra Solar Philippines Inc. to supply 850-MW renewable energy to cover Meralco’s mid-merit requirement starting 2026.

However, the Third-Party Bids and Awards Committee (TPBAC) declared a failure of bidding after no comparative bids were received during the two rounds of CSPs. Since there were no outstanding disputes and as advised by the TPBAC, Meralco proceeded with direct negotiation with the original proponent. Once signed and finalized, the power supply agreement will be submitted for approval of the Energy Regulatory Commission (ERC).

Meralco will also conduct another CSP via competitive challenge of Ahunan Power Inc.’s unsolicited proposal for 500-MW renewable energy mid-merit supply from a pumped storage hydro facility starting 2026.

Ahunan’s offer is still subject to competitive challenge under the rules of the DOE. This means that Ahunan has the right to match any comparative proposals.

Both these CSPs form part of Meralco’s compliance with the RPS and of its efforts to source up to 1,500 MW of its power requirements from renewable energy sources.

Terra Solar and Ahunan are renewable power subsidiaries under Prime Infrastructure Holdings Inc. of tycoon Enrique K. Razon.

“After Terra Solar, the other CSP that commenced already is the 500 MW midmerit in accordance with the PSPP approved by the DOE,” Valles explained.

Meralco President Ray C. Espinosa said the firm relentlessly looks for ways to cushion the impact of external volatilities on its operations.

“We will move ahead with the execution of sourcing strategies that include our planned CSPs, consistent with our PSPP, in a timely manner to ensure availability of cost-competitive power for our customers in the long-term.”