THE Manila Electric Company (Meralco) has secured the best bid for 1,200-megawatt (MW) supply from a generation company in accordance with the government-mandated Competitive Selection Process (CSP).
All three (3) bidders that expressed interest to participate in the CSP submitted their qualification documents, technical proposal, and bid price on January 23, 2024.
On the same day, the Bids and Awards Committee for Power Supply Agreements (BAC-PSA) named South Premiere Power Corp (SPPC) as the best bidder after submitting the lowest offer for Meralco’s baseload requirement.
SPPC offered a total levelized cost of electricity rate at Php 7.0718 per kilowatt-hour (kWh) for the entire 1,200-MW requirement. The unincorporated joint venture of Limay Power Inc. and San Roque Hydropower Inc. meanwhile submitted the next best bid after it offered a rate of P7.1006 per kWh for 150-MW capacity.
For a capacity of 210 MW, First Natgas Power. Corp. (FNPC) offered a rate of Php 8.4489 per kWh.
Except for the offer of FNPC, all other offers received were below the Php 7.1538 per kWh reserve price set for this CSP, according to the BAC-PSA.
All submissions have passed the criteria contained in bidding documents and pre-qualification evaluation.
The BAC-PSA is also set to conduct a post-qualification evaluation and submit its recommendation and report to Meralco’s Board of Directors for approval of the best bid as the winning power supplier prior to the issuance of a Notice of Award.
Meralco BAC-PSA Chairman Lawrence S. Fernandez said the distribution utility has complied with Department of Energy (DOE) Department Circular No. DC2023- 06-0021, Series of 2023 and Energy Regulatory Commission (ERC) Resolution No. 16, Series of 2023 which require that the bid be conducted in an open and transparent manner. To further ensure transparency and fairness, CSP observers witnessed the submission and opening of bids and the proceedings were streamed live.
“Meralco, as a highly-regulated entity, has conducted its business in full compliance with the rules and regulations promulgated by the ERC and DOE. All contracts resulting from this CSP will be subject to the regulatory proceedings of the ERC,” Mr. Fernandez said.
The Terms of Reference (TOR) conformity to Meralco’s Power Supply Procurement Plan was reviewed and approved by DOE and followed the DOE’s recommendation that, pursuant to its October 11, 2023 Advisory (on the conduct of CSP for power supply using indigenous natural gas as transition fuel), this bidding highly encouraged the participation of power suppliers with natural gas fired power plants and prioritized the use of indigenous natural gas. During the CSP, the bidding documents were also updated to consider the recommendations of ERC Chairperson Monalisa C. Dimalanta.
The resulting 15-year Power Supply Agreement from this CSP—which was based on Meralco’s DOE-approved Power Supply Procurement Plan—will cover Meralco’s future capacity requirements, including the 1,000 MW (net) supply that was covered by its PSAs with change in circumstance cases that are pending resolution.
