Philippines: Meralco, Semirara ink 10-year power supply

Philippines: Meralco, Semirara ink 10-year power supply

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.

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Link to Original Article:
http://www.philstar.com/business/2017/05/07/1697323/meralco-semirara-ink-10-
year-power-supply

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com