Taguig court issues TRO vs Meralco’s power supply bidding

Manila Electric Co. (Meralco), the power distributor giant of the MVP Group, faces a roadblock after a regional trial court issued a temporary restraining order against its planned bidding for an additional power supply of 1,000 megawatts (MW).

In a five-page Order promulgated on July 31, 2024, Executive Judge Byron G. San Pedro of Taguig City Regional Trial Court (RTC), Branch 15-FC, granted the petition of the members of the consortium operating the Malampaya gas field — Prime Energy, Prime Oil and Gas Inc, UC38 LLC, and the Philippine National Oil Exploration Corp (PNOC-EC) — for the immediate issuance of the 72-hour temporary restraining order (TRO) against Meralco’s conduct of competitive selection process for its 600 MW and 400 MW power supply requirements after finding merits to the verified complaint by the plaintiffs.

“Upon evaluation of the allegations contained in the verified complaint for injunction, it appears from the facts shown that great or irreparable injury would result to the plaintiffs-applicants before the writ of preliminary injunction could be heard.

“In other words, there exists EXTREME URGENT NECESSITY for the writ as to warrant the issuance of Temporary Restraining Order to prevent further damages to the plaintiffs’ interests, the government, and the environment,” the Taguig court ruled.

The court has set a TRO bond of P5 million.

“Upon posting a TRO bond which is hereby fixed in the amount of five million pesos (P5,000,000), let a Temporary Restraining Order effective for 72 hours be issued in favor of the plaintiffs-applicants enjoining the respondent Manila Electric Company from conducting its competitive bidding selection process (CSP), under its current Terms of Reference, including the receipt of bids, the award and the implementation of any award arising from (it),” the RTC said.

The Malampaya consortium earlier filed a complaint against Meralco. It stressed that pursuing the bidding can put indigenous natural gas at a disadvantage, “violat[ing] the preference given” by existing laws.

“Increased reliance on imported sources of fuel threatens the country’s energy security and energy sovereignty because these are greatly susceptible to a volatile market,” the previous petition said.

It also said Meralco’s bidding done through the Competitive Selection Process (CSP) was “flawed, skewed or supplier-driven and grossly violative of existing laws, rules and regulations.”

The bidding process was scheduled for August 2 at 9 a.m.

It added that the bidding could “put the country in a situation where a significant portion of our power supply is placed in the hands of imported coal and imported LNG, the prices of both are notoriously unstable and extremely subject to external shocks in the market.”

Furthermore, it said that awarding PSAs only to suppliers using imported fuel will also harm the exploration and development of indigenous resources, and will affect the Malampaya project, which has been reliably and securely supplying natural gas to power plants that provide 30 to 40 percent of Luzon’s electricity requirements.

Sought for comments, Meralco said it has yet to receive an official copy from the Taguig court.

But an official insisted that Meralco follows existing rules of the Department of Energy and the Energy Regulatory Commission in conducting biddings.

“It is our mandate to ensure that we conduct these in a timely manner, as delay will expose our consumers to unnecessary burden in the amount of billions of pesos in the form of higher power rates,” said Jose Ronald V. Valles, Meralco SVP and Head of Regulatory Management.