ERC urged to veto ‘expensive’ Meralco power deals

ERC urged to veto ‘expensive’ Meralco power deals

Watchdog Power for People Coalition (P4P) sought the energy regulator’s intervention to block Meralco’s supply contracts with generation companies using fossil fuels, as it warned of a further spike in electricity bills.

In a statement, the group said it filed petitions at the Energy Regulatory Commission (ERC) on Monday to reject Meralco’s deals with the following four companies owned by San Miguel Corporation and Aboitiz Power: Excellent Energy Resources, Inc., GNPower Dinginin, Southern Power Premiere Corporation, and Mariveles Power Generation Corporation.

P4P said the contracts were worth 3 gigawatts of power, and are still up for the ERC’s approval.

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It alleged that the terms of these power deals were “unfavorable to consumers and small businesses.”

“Everyone loses except big power players: Meralco, San Miguel, and Aboitiz, who are leaving consumers no choice but to pay for more expensive electricity while their profits are soaring,” P4P Convenor Gerry Arances said Tuesday.

The group added that the contracts give authority to the plants to “automatically pass” costs to consumers. If the ERC greenlights these contracts, P4P said consumers would suffer from costly electricity bills for another 15 years.

“We are asking the ERC to reject these contracts as part of their responsibility of protecting the public. Otherwise, they will condemn a new generation of consumers to 15 years or more of expensive power,” he said.

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A supposed conflict of interest in the bidding process was also floated by the P4P, specifically for two power plants. This, as Meralco generation arm MGen and the Aboitiz Group revealed a joint venture in March to acquire two San Miguel-owned gas assets to develop a massive liquefied natural gas (LNG) facility in Batangas City. The two projects are the Ilijan gas plant under Southern Power Premiere Corporation (SPPC) and the under-construction Excellent Energy Resources Inc. (EERI) plant.

Inquirer has asked for ERC’s comment but has yet to respond as of writing.

In February of this year, Meralco defended its series of competitive selection processes, saying they were “geared towards securing sufficient power supply at the least possible cost.”

“This is to minimize, if not avoid, dependence on the Wholesale Electricity Spot Market (WESM), where prices are known to be highly volatile, especially during the dry season given the higher demand and the historically tight supply,” Meralco said.