MGen CEO to focus on ‘clean coal’ plants

ROGELIO L. Singson, the newly appointed executive of the Manila Electric Co. (Meralco), said he will focus on “supercritical clean-coal plants”.

“I will focus on the general direction of MGen [Meralco PowerGen Corp.] in relation to the needs of Meralco. I have had discussions with Oscar Reyes and Manuel Pangilinan in terms of overall direction, such as what to do, where to go, because we realized the industry is changing,” said Singson, MGen CEO and newly appointed senior vice president of Meralco.

MGen is engaged in a number of coal-power projects, which have all yet to take off pending regulatory approvals. “We are now focusing on supercritical clean-coal plants,” Singson, a former Department of Public Works and Highways secretary, said.

While MGen’s focus is on coal-power plants, the utility firm is also cautious on the rising demand for renewable energy (RE).

“We are seeing some erosion in power sources. We think that RE and LNG [liquefied natural gas] will have a strong play in terms of current sources,” Singson said. “I think we, as MGen and Meralco, really have to look at where do we want to go to: Do we want to develop more coal or RE and gas?”

PSAs

ANOTHER challenge Singson faces is the delay in approvals of the seven power-supply agreements (PSAs) filed by MGen with the Energy Regulatory Commission (ERC).

The PSAs involve a supply of 3,551 megawatts, which corner 81 percent of the combined output of the seven power plants, most of which are owned or partly owned by Meralco through its power-generating unit MGen and affiliate Global Business Power Corp.

These seven PSAs pending for approval are inked with Redondo Peninsula Energy Inc., Saint Raphael Power Generation Corp. Atimonan One Energy Inc., MGen.Panay Energy Development Corp. (PEDC), Global Luzon Energy Development Corp., Central Luzon Premiere Power Corp. and Mariveles Power Generation Corp. The PSA applications were filed in 2016.

“Hopefully, with ERC now stabilizing, we can go back to them and really appeal to them, because we really need these PSAs as soon as possible so the impact of baseload power that we need will not be delayed,” Singson added.

Evaluation

ACCORDING to the ERC, it has not approved the PSAs because these are still being evaluated to ensure that only just and reasonable costs shall be included in the electric bill.

“We are carefully scrutinizing each of the cost components in the Meralco PSA applications that is why the final approval of these applications have been taking some time”, ERC Officer in Charge Alfredo J. Non said.

The ERC’s PSA approval entails a comprehensive process that includes: the conduct of the hearing process, filing of formal offer of evidence, technical evaluation, Commission deliberation and issuance of a decision.

ERC Commissioner Josefina Patricia Magpale-Asirit said early this month the agency is “hopeful” it can decide on three of the seven PSA applications within the year.

“Yes. It’s still long before 2017 ends,” Asirit said. “Hopefully, barring any other complications, we should be able to consider a lot of the issues that have been put forth on the applications put before us.”

Stability

OF the seven applications, three of which “have not been heard yet”, while one was issued a provisional authority (PA). The remaining three applications, Asirit said, are “in different stages.”

“There is one that was issued provisional approval only because there was the ability to benchmark. It is not a greenfield plant, and it was necessary for the same to be addressed as an interim measure to meet demand requirements in a particular period and that’s the PEDC contract,” Asirit added.

Three have actually not been heard yet because there’s no submission of environmental compliance certificate.

The PA that was granted to the PEDC in July 2016 was necessitated in view of the frequent yellow alert status of power reserves at that time.

“We must remember that stable supply of power is among the anchors of our economy,” Non said. “We granted the provisional approval because it will be more beneficial to the consuming public and the country as a whole to have a continuing stable power supply than have rotating brownouts, which are more damaging to the economy.”