The government’s approval of the construction of 1,200-MW coal-fired power generating facility in Atimonan, Quezon by a company controlled by the Manila Electric Company (Meralco) could result in the award of six more power supply agreements to the power firm which are disadvantageous to the public, a lawmaker said Monday.
Rep. Carlos Zarate of Bayan Muna party-list was referring to the project of Atimonan One Energy, Inc. that seeks to construct a dedicated point-to-point facility to connect the 1,200-megawatt coal power plant in Quezon province to the New Pagbilao substation of the National Grid Corporation of the Philippines.
At least 51 percent of Atimonan One is controlled by Meralco.
Meralco has a pending application for supply deals before the Energy Regulatory Commission with five other power generating firms.
“Does the decision to approve the transmission line project for the 1,200 megawatt (MW) project of Atimonan One Energy Inc. (Atimonan One) mean that ERC has already approved the supply agreements not only between Meralco and Atimonan One, but also between Meralco and six other Meralco-controlled generation companies?” Zarate said in a statement.
The six other power generation firms that Meralco is seeking to nail a power supply agreement with include Central Luzon Premiere (528 MW), Mariveles Power (528 MW), Panay Energy Development Corp (70 MW), Global Luzon Energy Development Corp. (600 MW), St. Raphael (400 MW) and Redondo Peninsula (225 MW).
Meralco PowerGen Corp. has the majority control of Redondo Peninsula Energy, while St. Rafael is a joint venture between Semirara Mining and Power Corp., Meralco PowerGen Corp. and Marubeni Corp.
Meralco PowerGen Corp. also has a 49 percent stake in Mariveles Power.
The Panay Energy Development Corp. and Global Luzon Energy Development Corp., on the other hand, are subsidiaries of Global Business Power Corp. of which 14 percent is owned by Meralco PowerGen.
Zarate claimed that the seven power supply agreements that Meralco awarded without bidding to Meralco-controlled companies will oblige Meralco customers to pay at least P91 billion in generation charges every year. This means that Meralco customers will be paying almost P2 trillion in generation charges over the 20- to 21-year duration of the contracts, on top of distribution and transmission charges.
Zarate is the author of House Resolution 566 which aims to determine whether the seven power supply agreements by Meralco for 3,551 MW are disadvantageous to consumers, if Meralco engaged in illegal or improper deals and if such actions were facilitated by the ERC.
“The ERC’s decision to approve the transmission line for the Atimonan One project looks like an attempt to clear the way for the eventual approval of the power supply agreements themselves. For these power supply agreements to be approved before the investigations are completed could be harmful to the interest of the general public,” Zarate said.