ERC rejects Meralco-SMC power supply deal
The Energy Regulatory Commission (ERC) rejected a power supply agreement between Meralco and San Miguel Corp., citing a lack of urgency and a projected power surplus for the current year. The decision impacts long-term energy planning and compliance with renewable energy standards.
Why it matters
Highlights regulatory oversight in the energy sector, affecting electricity costs and infrastructure development in the Philippines.
MANILA, Philippines - The Energy Regulatory Commission (ERC) has thumbed down Manila Electric Co. (Meralco)'s planned procurement of a 200-megawatt (MW) baseload power supply from San Miguel Corp.
In a 20-page decision dated July 14, the ERC ruled that Meralco and San Miguel's Sual Power Inc. (SPI) failed to establish the urgency and immediate necessity of their proposed power supply agreement (PSA).
Citing Meralco's submitted annual supply-demand scenario, the regulator said the utility giant is projected to have a surplus of 372 MW in its power requirements this year.
"Conversely, for the years 2027 to 2034, Meralco is projected to have a supply deficit ranging from 40 MW to 768 MW," it added.
The proposed PSA resulted from a competitive selection process conducted by Meralco, in which SPI emerged as the winning bidder after submitting the lowest offer of P4.2955 per kilowatt-hour (kWh).
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