DoE won’t approve Meralco’s terms for selection process

BW background - DoE won’t approve Meralco’s terms for selection process

MANILA Electric Co. (Meralco) is free to adopt its preferred terms of reference in the competitive bidding for the supply of 1,200 megawatt (MW), but the Energy chief will not approve a process that is different from what he previously suggested.

Wala na ako magagawa kung ayaw nila eh ayaw ko rin (I cannot do anything if they do not like [my suggestions], I also don’t like theirs),” Department of Energy (DoE) Secretary Alfonso G. Cusi told reporters last week when asked about an update on Meralco’s planned competitive selection process (CSP).

Mr. Cusi said he replied to the letter from Meralco detailing how the company intends to conduct the CSP.

The continuing exchange of correspondence between him and Meralco arose after the company invited power generation companies to supply its energy needs for the coming years. Two of the three bid invitations resulted in power supply agreements (PSA). The third was declared a failure as only one company — Meralco’s power generation unit — came forward with an offer.

Mr. Cusi suggested changes in the term of reference for the CSP to allow existing or brownfield projects to participate. Meralco preferred only new power plants or greenfield projects to supply the 1,200 MW.

“I don’t need to approve it if they want to publish it, they can do it as long as sasabihin nilang hindi ko ito inaprubahan (they will say that I did not approve it),” Mr. Cusi said.

Kasi ’yung first bidding, sabi inaprubahan ko eh hindi ko naman inaprubahan ’yun. Ang inapruba ko lang eh publication nila (Because in the first bidding, it was said I approved it, but I did not. What I approved is the publication),” he added.

Asked whether a CSP called by Meralco under its preferred terms would be valid, Mr. Cusi said: “They are a private entity at meron kaming (and we have) CSP rules.”

The CSP rules were issued by DoE to allow bidders to offer the least cost power to benefit consumers. The power generation charge agreed under a PSA is passed on to electricity users and appear in their monthly electricity bill.

“Pero (But) to avoid these problems, we are coming up with a CSP template,” Mr. Cusi said.

Mahirap kasi sa Meralco kaya I want it open eh because sila ang DU (distribution utility) at the same time owner ng generation. Kaya dapat medyo iba ang sistema ng CSP. (The difficulty with Meralco, that’s why I want the bidding open to all, is because they are the DU and at the same time the owner of power generation. That’s why it must follow a different CSP system),” he added.

Mr. Cusi said he had been working on coming up with a CSP template, but said its application must be prospective. — Victor V. Saulon

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