Bayan Muna urges Meralco to exclude own gencos from power supply bid

Bayan Muna party-list on Thursday asked the Manila Electric Company (Meralco) to exclude its generation company subsidiaries and affiliates from bidding for power supply agreements.

Party chairman Neri Colmenares and Representative Carlos Zarate made call, saying there should be no suspicions of rigging the bidding process to assure consumers that they get the least cost of electricity from power suppliers.

In a statement, Colmenares claimed that the Meralco gencos are the same as those that have been discredited after negotiated power supply agreements with the company were exposed in an earlier congressional inquiry pointing to overpriced charges that were passed on to consumers.

The Supreme Court already ordered to put a stop against the power supply agreements as Meralco were awarding the PSAs without bidding—violating the competitive selection process.

“The upcoming bidding for supply of electricity to Meralco, therefore, will only turn into a charade, if Meralco insists on fielding its own genco subsidiaries and affiliates as bidders in the power supply agreements. It will be a shame-faced continuation of Meralco’s earlier attempts to corner these power contracts for itself through the Meralco gencos,” Colmenares claimed.

“Consumers will suffer from a faulty bidding because such an exercise will not help pick the most deserving power suppliers that are willing to sell electricity to Meralco and its customers at the least cost. Meralco will try to find ways to favor its own subsidiaries and affiliates,” he further claimed.

Pangilinan-led Meralco said there is no legal basis for the recent statements against the company, as affiliate generation companies are not prohibited from participating in bidding for power supply requirements.

“We would like to take strong exception to the very unfair statement of Mr. Colmenares and Congressman Zarate against Meralco,” Joe Zaldarriaga, spokesperson of Meralco, said in a mobile message.

The Supreme Court earlier ordered all power supply agreements be submitted to the Energy Regulatory Commission on or after June 30, 2015 to undergo competitive selection process.

The process mandates electric cooperatives and distribution utilities such as Meralco to get at least two offers before awarding a supply agreement.

Meralco president Ray Espinosa has said they would adhere to the Supreme Court’s order. However, a competitive selection process could delay the construction of a 1,200 megawatt (MW) coal-fired power plant in Atimonan, Quezon, he added.

Despite Espinosa’s pronouncements, Zarate claimed the construction of the power plant will push through, but it will be handled by Atimonan One Energy Inc., a Meralco wholly-owned subsidiary and a discredited genco. Atimonan One’s supply agreements with Meralco were affected by the Supreme Court’s ruling, the lawmaker noted.

“Espinosa’s statement raises worrying questions: Will Meralco massage and twist the bidding terms to eliminate other bidders and assure Atimonan One’s victory? How will consumers get the least cost of electricity when the bidding rules are designed to eliminate competition?” Zarate said.

“Let Meralco be reminded that we have laws to protect consumers. For instance, the Philippine Competition Act declares it unlawful for ‘one or more entities to abuse their dominant position by engaging in conduct that would substantially prevent, restrict or lessen competition,” he added.

“There is no factual nor legal basis for their statements against Meralco, and that these statements are obviously meant to discriminate against Meralco and its affiliates in participating in the Competitive Selection Process that Meralco is currently undertaking in compliance with the recent Supreme Court decision and Department of Energy pronouncements,” Zaldarriaga said. —VDS, GMA News