THE Energy Regulatory Commission (ERC) has cautioned the Manila Electric Company (Meralco) in the conduct of ongoing competitive selection process (CSP) for 1800-megawatt (MW) baseload capacity.
During the hearing of the House Committee on Legislative Franchises last Wednesday, ERC Chairperson Monalisa Dimalanta said Meralco was told to make sure it is not unduly limiting the number of potential bidders. She said a letter was already sent to Meralco stating the ERC’s observations on the published bid invite.
There are currently six potential bidders for the upcoming CSP. These are GNPower Dinginin (GNPD), First NatGas Power, SP New Energy, Mariveles Power Generation, Excellent Energy Resources and Masinloc Power Partners.
“We already raised with Meralco our concerns on the limited number of potential participants that could participate (to the CSP),” Dimanlata told lawmakers.
As the regulator of the power industry, Dimalanta said the ERC is mandated to promote competition, encourage market development, ensure customer choice, and penalize abuse of market power in the industry.
During the hearing, Cong. Dan Fernandez of the Lone District of Santa Rosa, Laguna lamented that the power plants that could join the auction are those that should be in commercial operation not earlier than January 2020 but no later than May 2025.
“That is also our concern, so we laid it out to Meralco in our letter to them that we will submit to the committee,” Dimalanta said.
Lawmakers led by Cong. Fernandez urged the ERC to act on the terms set by Meralco for 1,800 MW of electric supply.
Fernandez said ERC should stop Meralco from proceeding with the bidding until a review and study of its terms of reference (TOR) are completed.
Earlier, Cong Fernandez urged Congress to split the mega-franchise of Meralco into three.
“It’s high time we renew its franchise to pave the way for the split of the mega-franchise we granted Meralco,” said Fernandez in the speech.
“If possible, we can split it into three franchises since Meralco actually operates in three sectors in Luzon— NCR (National Capital Region), South Luzon (Calabarzon) and North Luzon sector of Pampanga and Bulacan,” he added.
Meralco’s VP and Head of Corporate Communications Joe Zaldarriaga said Meralco is fully compliant with all government regulations and even outperformed the level of service required by the regulator.
“Further, while Meralco is the largest utility in the country, it has never committed and has no record of any anti-competitive behavior or abuse of market power. On the contrary, we have always managed to supply electricity to our customers in the most transparent and least cost manner,” said Zaldarriaga.