TOKYO: The Manuel Pangilinan-led Manila Electric Co. (Meralco) will allot P86 billion for capital expenditure (capex) in the next five years to upgrade its distribution network and customer service infrastructure.
Oscar Reyes, Meralco president and chief executive officer, said in a press briefing here on Saturday that the company plans to spend P65 billion for its distribution network and P21 billion for its electricity generation business from 2015 to 2019.
“This will enable us to keep in step with growth in energy sales which has been around 3.2 [percent]to3.5 percent, but more than just the simple growth, it’s meeting the new demands of customers,” Reyes explained.
From 2010 to 2014, Meralco has allotted P50 billion for its distribution business and P20 billion for its power generation business.
The P86-billion five-year capex will “finance investments in customer and load growth, climate change hardening, automation and technology, sustained reliability and quality in network, and safety.”
The five-year capex will also cover costs related to the relocation of facilities affected by the government’s public-private partnership projects.
Reyes also said that Meralco will spend P14.68 billion next year for the development of its power generation plant portfolio to avert larger supply gaps in the summer months, as well as the installation of new facilities to make the distribution system less susceptible to damage from extreme weather.
Reyes said Meralco PowerGen Corp. (MGen) is expediting investments to build its power generation plant portfolio in a bid to regain ground lost to legal delays in building new generation capacity.
He added that the “San Buenaventura Power Ltd. is developing a 544-megawatt [MW] coal-fired power plant in Mauban, Quezon. The project, a joint venture with Electricity Generating Public Co. Ltd. of Thailand, is in the final stages of preparation for the issuance of a notice to proceed, pending approval by the Electricity Regulatory Commission.”
“MGen’s Redondo Peninsula Energy Inc.’s joint venture is also scheduled to commission two 300-MW coal-fired power plant in 2015 but is still awaiting clearance by the Supreme Court,” Reyes said.
Meralco’s earnings went up 7 percent to P14.3 billion in the first nine months from P13.6 billion last year, fueled by strong demand from its industrial and commercial segments of its market.
Meralco said in a disclosure to the Philippine Stock Exchange last week that it expects core profit to reach P17.8 billion this year, 4.6 percent higher than last year’s P17 billion.