Meralco eyes 2nd power plant

Manila Electric Co., the country’s biggest power distributor, has started preparations to put up its second 600-megawatt power facility, which may be fueled by either coal, natural gas or hydro resources.

In a recent briefing, Meralco chief operating officer Oscar Reyes said the distribution utility has started conducting the necessary studies that would confirm the viability of using either coal or liquefied natural gas.

The proposed power plant, 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.

“Our timetable for the planned facility is a function of demand and supply. Supply is a question of which of the existing power plants are going to be retired from the [Luzon grid] system as new capacity comes in. But we’re mainly looking at 2016 or 2017,” Reyes explained.

According to Reyes, the consideration for the use of coal would anchor mostly on this particular fuel’s advantage in terms of cost efficiency.

Meanwhile, the use of natural gas will be a function of the availability of supply, whether more gas will be made available from the Malampaya gas field off Palawan. Another consideration was the availability of the necessary infrastructure, whether a land-based gas terminal or a floating storage and regasification unit (FSRU), Reyes said.

“If more natural gas becomes available, then we would prefer natural gas because it’s indigenous. We’re busily exploring all options but natural gas would be a good play [for our power-generation portfolio] because it offers diversification,” he added.

Meanwhile, Reyes also disclosed Meralco’s plans to look for potential hydropower projects, which could be looped with prospective bulk water supply projects.

“We’re scouting [for potential projects] in Luzon. There are various potentials of about 150 to 300 megawatts of impounding hydro,” he said.

Among the sites being considered were Laiban Dam, Sierra Madre area and Kaliwa and Kanan Rivers, for which several proposals for bulk water supply projects have already been put forward to the government.

“With hydro resources, you could have a bulk water and power project. But if you’re looking at supplying water requirements for Metro Manila, then you’ll have to go for a source that is reasonably near to the market like the Sierra Madre area, Kaliwa and Kanan Rivers and Laiban. I think those will be led by bulk water projects. We’re just exploring what the opportunities are,” Reyes explained.

Meralco is now headed by businessman Manuel V. Pangilinan, who also chairs the west zone water concessionaire, Maynilad Water Services Inc.

For now, however, Meralco has yet to find a partner for its foray into the renewable energy sector.

“I think for us, we will partner with whoever can bring better value both for our customers and for us,” he said.