The Manila Electric Company (Meralco) on Wednesday announced it secured an emergency power supply agreement (EPSA) with San Miguel’s South Premiere Power Corp. (SPPC) for the supply of 300 megawatts (MW) baseload capacity.
The EPSA took effect on March 26, 2023 and will continue until March 25, 2024.
The EPSA between Meralco and SPPC followed the receipt of certification from the Department of Energy (DOE), exempting the power supply deal from Competitive Selection Process (CSP).
The exemption allowed both companies to immediately implement the EPSA.
Meralco said the EPSA reflects a two-part tariff composed of a P1.75 per kilowatt-hour (kWh) fixed cost and variable cost indexed on fuel price movements.
The latest power deal, the power distributor said, partially replaces the capacity covered by Meralco’s 2019 PSA with SPPC, which was subjected to a Writ of Preliminary Injunction issued by the Court of Appeals.
“The execution of the EPSA will help shield electricity consumers from volatile and potentially higher generation costs in the Wholesale Electricity Spot Market, which is historically recorded during the dry season when power demand spikes,” Meralco said.
The company said it also sought the DOE’s approval for another EPSA for its 180-MW baseload capacity requirement meant to boost available supply and help address the reduced capacity of natural gas-fired power plants.
Meralco said the 180-MW supply was originally subjected to two rounds of CSPs, which both failed due to a lack of bidders.
“Given the urgency of the additional supply for the dry season, Meralco sought approval to execute an EPSA instead,” it said. —VAL, GMA Integrated News