Meralco to tap spot market for 260-MW peaking supply

By Alena Mae S. Flores – May 1, 2024, 7:50 pm
from manilstandard.net

Power retailer Manila Electric Co. plans to source its 260-megawatt peaking capacity requirement from the Wholesale Electricity Spot Market, where prices are more volatile due to lack of available capacity offered from generation firms.

Meralco senior vice president and head of regulatory management Jose Ronald Valles said the company’s bids and awards committee declared a failure of bidding for the second round of the competitive selection process of the 260-MW supply.

He said Meralco then commenced direct negotiation with the single offeror, San Roque Hydropower Inc.

Meralco, however, received a letter of withdrawal from SRHI on April 13, saying that “we will not be able to generate the required portion of the target 260-megawatt peaking capacity due to El Niño.”

Valles said Meralco did not receive any other offer from other power suppliers since then. The company needs the 260-MW peaking supply until July.

“The 260 MW, if we were able to get that, then that should have adequately covered our requirements except for the sudden increase in the demand given the severe weather conditions that’s happening,” he said.

“We will have to source that elsewhere again from WESM. So that’s the only available option to us,” he said.

Valles said Meralco also foresees the need to procure additional supply of up to 100 MW to cover its peaking requirements for a period of six months.

He said Meralco is negotiating for a 100-MW peaking capacity contract with state-run Power Sector Assets and Liabilities Management Corp.

“Under existing CSP Guidelines, the CSEE with PSALM is immediately implementable without need for Energy Regulatory Commission’s provisional authority or interim relief, provided the contract is filed with the ERC within 30 days from implementation,” Valles said.