THE Manila Electric Co. (Meralco) has signed agreements with three power producers to meet an expected increase in demand during the summer months and avoid being caught up in price fluctuations on the wholesale electricity spot market.
The power distributor said in a regulatory filing to the Philippine Stock Exchange on Wednesday it would secure up to a combined 204 megawatts of power under separate interim power supply agreements (IPSAs) that it forged with Toledo Power Co., Panay Power Corporation and 1590 Energy Corporation.
Toledo Power has agreed to supply to Meralco 28 megawatts of power with an option for an additional 9 megawatts, while Panay Power will supply up to 27 megawatts. Both supply agreements will be from April 1 up to June 30 of this year.
Meralco will source up to 140 megawatts from 1590 Energy and associated energy output from its power plant in Bauang, Batangas.
“The IPSAs were entered into to address the increase in demand and mitigate the company’s exposure to the wholesale electricity spot market (WESM) during the summer months,” Meralco first vice president and head of legal William Pamintuan said in the filing to the local bourse.
The supply agreements are subject to Energy Regulatory Commission (ERC) approval, and will expire on June 30 this year unless terminated earlier or extended.
It was earlier reported that the Department of Energy has called on Meralco to forge power supply contracts to bolster its power supply capability ahead of an expected spike in electricity demand during the summer months.
Meralco president Oscar Reyes said the firm said it recognizes the merits of getting additional power supply, but the company’s ability to do this will depend on how fast the ERC can approve the power supply agreements between Meralco and power producers.