Meralco expects tight power supply

Manila Electric Co., the country’s biggest power distributor, expects electricity supply to be “fairly tight” in two to three years’ time should the growth in demand, as seen last month, continue for a prolonged period.

Meralco president and chief executive officer Manuel V. Pangilinan cited the sales volume in January this year, which rose 8 percent from the same month last year.

The increase, he explained, was driven mainly by new connections from the commercial and industrial sectors and from organic growth.

“We’re pleasantly surprised with the extent of the increase. So that indicates—if we are an economic indicator—a good sign for the economy. If this growth continues, we’re going to have a fairly tight supply in the next two to three years,” he noted.

According to Pangilinan, Meralco is pushing forward its second power project as the company is in the process of conducting a feasibility study for a natural gas-fired power facility, one of the options on the table.

Meralco chief operating officer Oscar Reyes earlier said that the power distributor wanted to have a 600-MW facility as its second project—the fuel for which has yet to be decided. The proposed facility, which may be put up in two phases in a still undisclosed location in Luzon, is targeted to start commercial operations by 2016 or 2017.

Meanwhile, Pangilinan added that the company was still considering to pursue the 150-megawatt peaking plant in Laguna, most probably next year.

The company’s return to power generation was through Redondo Peninsula Energy Inc. (RP Energy), which is building a 600-MW coal-fed plant in Subic. The first 300 MW is expected to come online in 2014, while the remaining 300 MW will be ready in 2015.

Meralco expects to spend as much as $2.3 billion (about P103 billion) to complete its 1,500-MW power-generation portfolio between now and 2016.