Meralco admits telling Therma Mobile to sell at P62/kwh at spot market
MANILA, Philippines—The Manila Electric Company’s (Meralco) admission that it has instructed Therma Mobile Inc. (TMO) to sell at a high price of P62 per kilowatt hour at the spot market instead of the contracting price of only P8.65/kwh. which, according to Senior Associate Justice Antonio Carpio, can be considered price manipulation if that happened in the stock market.
During interpellation at the second part of the oral arguments on power rate increase Tuesday, Meralco admitted that even if it ordered TMO to sell at P62/kwh, it also bought at the spot market.
Carpio asked: “Did Meralco tell TMO to sell at P62 and did Meralco buy at P62? Meralco’s lawyer Victor Lazatin said it is not quite accurate.
“In other words, Meralco bought without knowing how much it will pay,” Carpio asked to which Lazatin said yes.
“If this were to happen at the stock market, it would be price manipulation but you are saying this is not price manipulation because Meralco did not know the price?” Carpio asked. Lazatin said buyers in the spot market are all price takers.
Meanwhile, Associate Justice Marvic Leonen asked Meralco: “You do have an effect in setting the standards in the industry, at least in the distribution utilities?”
“Yes, the same is part of being an industry leader,” Lazatin said.
Part 3 of the oral argument on power rate hike will resume on Feb. 11.