Meralco, EDC unit sign power supply deal

Manila Electric Company (Meralco) has sealed a deal with a unit of Energy Development Corp. (EDC) to supply electricity for its franchise area and ease the power constraints expected in the summer of 2015.

 

In separate disclosures to the Philippine Stock Exchange Wednesday, Meralco and EDC noted they executed a power supply agreement (PSA) for the partial capacity of Bacman Geothermal Inc.

 

Under the agreement, Bacman will supply Meralco with 50 MW from the Bacman Power Plants over a five-tear term that may be extended by another two years.

 

The agreement, however, is still subject to Energy Regulatory Commission approval.

 

"The PSA was entered into to address the forecasted supply constraint and mitigate the Company’s exposure to the Wholesale Electricity Spot Market, during the summer months of 2015 and as part of Meralco’s continuing efforts to source additional capacities through interim bilateral contracts with power producers with available contracted capacity," the Philippines' largest distribution utility said.

 

The Meralco franchise area covers 5.5 million commercial and residential customers in Metro Manila, Bulacan, Cavite, Rizal, and some parts of Batangas, Laguna, and Quezon.

 

Earlier this month, Meralco president Oscar Reyes said the firm is scrambling to secure short-term power supply agreements to ensure continuity of service during the critical summer months of 2015. –

 

It signed an interim power supply agreement with Aboitiz Power Renewables Inc. for 50-megawatt capacity of Makban geothermal plant in Laguna.

 

Apart from this new contract, the distribution utility is also extending its contract with Global Business Power Corp., 1590 Energy Corp.'s Bauang power plant and PanAsia Energy Inc.'s Limay power plant, Reyes said.

 

The Department of Energy (DOE) expects a reserve shortfall in the Luzon grid – primarily stemming from a month-long maintenance shutdown of Malampaya gas line and scheduled outages of other power plants, Bayan Muna representative Neri Colmenares said earlier. – Danessa O. Rivera/VS, GMA News