Manila Electric Co. (Meralco) yesterday signed power supply agreements (PSAs) with three companies that will supply a combined 1,200 megawatts to Meralco for a decade.
Meralco closed the PSAs on Friday with Phinma Energy Corp., San Miguel Energy Corp. and South Premiere Power Corp. (which is also a San Miguel unit). The contracts will be effective starting Dec. 26.
“The prices from the PSAs we are signing today are significantly lower than the average generation cost today of around P5.88 a kilowatt-hour,” said Meralco president and CEO Ray C. Espinosa.
“Once the PSAs are implemented, Meralco consumers are expected to save around P0.28 per kWh or P9.46 billion annually for 10 years,” he added.
Phinma Energy Corp., which has been bought by the Ayala group, signed for a contract capacity of 200 MW at a rate of P4.7450 a kWh.
San Miguel Energy signed for 330 MW at a rate of P4.6314 a kWh. South Premiere Power, which will give bulk of the supply, signed a contract for 670 MW at a rate of P4.6314 a kWh.
The PSAs will be filed with the Energy Regulatory Commission to undergo regulatory proceedings and evaluation.
The signing of the PSAs marks the successful culmination of a Competitive Selection Process (CSP) done in accordance with the Department of Energy circular requiring distribution utilities such as Meralco to procure electricity through CSPs.
The CSP was administered by a Third-Party Bids and Awards Committee (TPBAC) that was constituted pursuant to the DOE circular.
The TPBAC was chaired by consumer representative and lawyer Ferdinand Domingo. The other consumer representative was Adrian Cristobal, former trade chief and now president of SteelAsia Manufacturing Corp.