Meralco, Semirara ink 10-year power supply

MANILA, Philippines -  Manila Electric Co. (Meralco) has executed a 10-year power supply deal with a unit of Semirara Mining and Power Corp. for its retail electricity business.

Meralco said its local retail electricity supplier (RES) signed a power supply agreement (PSA) with Sem-Calaca Power Corp. to supply 420 megawatts (MW) in capacity for 10 years.

The deal effective from June 29, 2019 up to June 25, 2029, could be extended by another four years.

Sem-Calaca is a wholly-owned subsidiary of Semirara Mining that owns and operates the 30-year-old 2x300-MW coal-fired power plant in Calaca, Batangas.

The power company is spending at least $150 million to rehabilitate the power plant, which will result in higher capacity and extend its economic life.

Completion of rehabilitation works is expected in late 2018 to 2019.

Meralco participates in the retail competition and open access (RCOA) regime through its local RES called MPower.

Under the RCOA regime, end-users that are part of the contestable market, or contestable customers, are given the choice to choose their supplier of electricity aimed to foster competition in the generation Manila Electric Co. (Meralco) has executed a 10-year power supply deal with a unit of Semirara Mining and Power Corp. for its retail electricity business.

Meralco said its local retail electricity supplier (RES) signed a power supply agreement (PSA) with Sem-Calaca Power Corp. to supply 420 megawatts (MW) in capacity for 10 years.

The deal effective from June 29, 2019 up to June 25, 2029, could be extended by another four years.

Sem-Calaca is a wholly-owned subsidiary of Semirara Mining that owns and operates the 30-year-old 2x300-MW coal-fired power plant in Calaca, Batangas.

The power company is spending at least $150 million to rehabilitate the power plant, which will result in higher capacity and extend its economic life.

Completion of rehabilitation works is expected in late 2018 to 2019.

Meralco participates in the retail competition and open access (RCOA) regime through its local RES called MPower.

Under the RCOA regime, end-users that are part of the contestable market, or contestable customers, are given the choice to choose their supplier of electricity aimed to foster competition in the generation and supply sector.

A local RES is defined as entities under a distribution utility (DU) that may engage in the business of supplying electricity to the contestable market without need of obtaining a license from the ERC.

Currently, MPower accounts for about 50 percent of the contestable market within its franchise, or 18 percent of the total nationwide.

Meralco has also formed a subsidiary called Vantage Energy Solutions and Management Inc., after new rules required all DUs to wind down their local RES in three years and apply for a RES license to be able to serve the contestable market.

Customers with peak demand of one MW were mandated to shift to RCOA last Feb. 26 while mandatory contestability for those with at least 750 kilowatt (kW) is scheduled on June 26.

However, decision on the implementation on new rules, as well as the mandatory shift to RCOA are still pending in courts.