Meralco: Supply tight this summer

By Iris Gonzales, The Philippine Star

Posted at Mar 18 2014 07:26 AM | Updated as of Mar 18 2014 06:48 PM

MANILA - Manila Electric Co. (Meralco), the country’s biggest power distributor, said power supply this summer is tight but stopped short of saying that there would be blackouts.

In a briefing yesterday, Meralco president Oscar Reyes said there would be tightness in supply as several power plants will go on scheduled maintenance shutdowns.

He said Meralco is hoping that tightness in supply would not jack up prices as was the case in December 2013 and January 2014 when the Malampaya natural gas platform in offshore Palawan went on a 30-day maintenance shutdown from Nov. 11 to Dec. 10 last year.

Meralco urged the government, through the Power Sector Assets and Liabilities Management Corp. (PSALM), to run the 650-megawatt (MW) Malaya thermal power plant in Rizal at full capacity.

The facility started running at 130 MW yesterday, said PSALM president Emmanuel Ledesma in a separate advisory.

“According to NGCP (National Grid Corp. of the Philippines), they are going to be on yellow alert from March to September… without Malaya,” Reyes said.

A yellow alert status means that contingency reserves are below the minimum level set by the regulator but does not necessarily entail power outages or blackouts. In contrast, a red alert means there is severe power deficiency.

At least 1,750 MW may not be available during the summer months through June when power plants go on maintenance shutdown, according to data from Meralco and separate data from industry sources.

During the briefing, Meralco senior executive vice president Ricardo Buencamino said the Ilijan Power Plant (affecting 600 MW), owned by Kepco Philippines, is scheduled for maintenance shutdown from March 15 to April 9, while Lopez-owned San Lorenzo natural gas plant (affecting 250 MW) will also go on maintenance shutdown from April 9 to 14.

Furthermore, 250 MW of Lopez-owned Sta. Rita power plant will also be unavailable.

Separately, sources said GN Power (300 MW) also has a scheduled shutdown from Dec. 25 to April 7 and the Pagbilao power plant, owned by Team Energy, will also be shut down from May 24 to June 23, affecting 350 MW.

Asked if there would be power outages during the summer season because demand is traditionally higher, Reyes declined to say so.

“I think we have to hope that there’ll be no forced outages (of power plants that can compound scheduled maintenance),” he said.

“Not having Malaya (power plant) would make the situation tighter. And we will have certain risks,” he added.

PSALM’s Ledesma said Malaya already started running and how long it would run would depend on NGCP’s judgment.

“Malaya unit 2 has been online since 7 a.m. today, dispatched by NGCP at 130 MW. The question as to how long or how often Malaya will run during the summer months will depend on the system operator, NGCP,” Ledesma said.

As a contingency measure, Reyes said Meralco would be working with the Department of Energy (DOE), power generators, Philippine Electricity Market Corp. (PEMC) and NGCP to see if the maintenance shutdowns can be rescheduled after summer.

“We’re talking to all the generators to see whether they have excess capacity… Those who have spare and have no contracted capacity, we’ll see if we can work with them on least cost contract for a definite duration,” Reyes added.

Meralco would submit these proposals to the Energy Regulatory Commission (ERC) for approval.

‘Meralco should be cited for contempt’

Meanwhile, party-list group Bayan Muna asked the Supreme Court (SC) yesterday to cite and punish Meralco for contempt for trying to collect the P4.15 per kilowatthour (kwh) rate increase the tribunal stopped in December.

Rep. Neri Colmenares filed the motion for his group, whose petition in December prompted the SC to issue a restraining order against the rate adjustment. The court is expected to rule on the petition shortly.

Colmenares said Meralco should have respected the restraining order and should not have tried to collect the increase from its more than five million customers.

Prepaid electricity service opposed

The Trade Union Congress of the Philippines (TUCP), on the other hand, is seeking a stop to the prepaid electricity scheme recently launched by Meralco, arguing that access to electricity is a right that cannot be waived.

TUCP said Meralco must be sanctioned for violating the provisions of the Magna Carta for Residential Electricity Consumers with the implementation of its Prepaid Retail Electricity Service (PRES).

TUCP executive director Louie Corral noted that the magna carta protects residential electricity consumers by disallowing electricity supply disconnection beyond 3 p.m. on any day during the week, any time during weekends, official holidays, when a permanent occupant in the house is sick and dependent on a life-support system, when the owner is not in the house, and when there is a funeral wake in the house.

“With the prepaid scheme, electricity automatically shuts off when customers run out of load,” Corral pointed out.

“We believe that Meralco should be punished for abusing and skirting the law. Access to electricity, just like water, is a basic human right. These are our political rights as Filipinos that cannot be waived by saying this is voluntary on the part of consumers,” TUCP executive vice president Gerard Seno said in a statement.

The TUCP is set to file today a petition to prevent Meralco from implementing the PRES. The group is studying whether to file the petition before the ERC, or the lower court, or directly to the SC, TUCP spokesman Alan Tanjusay said.

‘Abolish overstaying PEMC’

Meanwhile, Rep. Edgardo Masongsong of the 1st Consumers Alliance for Rural Energy Inc. (1-Care) party-list is calling for the abolition of the “overstaying” PEMC for failing to ensure transparency and order in trading in the Wholesale Electricity Spot Market (WESM).

Masongsong said the “recent quandaries” in the operation of the WESM necessitate the immediate abolition of the PEMC, to be replaced with an independent market operator (IMO) to administer the spot market.

“It (PEMC) has been embroiled in a lot of controversies and has been overstaying since Section 30 of the EPIRA (Electric Power Industry Reform Act of 2001) or Republic Act No. 9136 provides that an independent entity should be formed not later than one year after the implementation of the WESM, which started commercial operations on June 26, 2006,” Masongsong said.

“More than that, the PEMC, as an interim IMO, has proven to be ineffective, inefficient and grossly incompetent,” he added.With Paolo Romero, Jess Diaz, Mayen Jaymalin, Michelle Zoleta