ERC orders distributors to file emergency power supply agreements
THE Energy Regulatory Commission (ERC) has ordered distribution utilities to file the emergency power supply agreements (EPSAs) they have entered into with generation companies.
“The DoE (Department of Energy) has been receiving many requests for exemption (from power procurement rules). So, we said it is better that instead of issuing a show cause order, we just remind them that EPSAs are allowed but this is the tariff that you can collect. It is hard to go through refunds and show cause orders,” ERC Chairperson and Chief Executive Officer Monalisa C. Dimalanta told reporters on Friday on the sidelines of the inauguration of San Miguel Global Power Holdings Corp.’s battery energy storage system in Limay, Bataan.
Last week, the ERC issued an advisory reminding all distribution utilities entering into EPSA agreements with generation companies to comply with the guidelines set by the DoE.
“Negotiated procurement of emergency power supply wherein the cooperation period of the corresponding EPSA shall not exceed one year and such EPSA shall be filed immediately before the ERC upon the issuance and within the effectivity of the CoE-CSP (Certificate of Exemption-Competitive Selection Process),” the ERC said.
Manila Electric Co. (Meralco) has entered into a 300-megawatt (MW) EPSA for one year with South Premiere Power Corp. (SPPC) which runs between March 26, 2023 and March 25, 2024.
This is the third time Meralco executed an EPSA after it lost access to 670-MW worth of power capacity from SPPC.
Ms. Dimalanta said that the parties haven’t yet filed for the approval of their EPSA.
“Provided finally, that the rate shall be equivalent to or lower than the latest ERC-approved generation tariff for same or similar technology in comparable areas,” ERC said in its advisory.
Ms. Dimalanta said that the ERC will announce the rates after Easter.
Ms. Dimalanta has said that the ERC will review the EPSAs entered into by distribution utilities and generation companies to determine the “reasonableness of the tariff.”
She said refunds may follow if the ERC determines that the rates are not reasonable.
Meralco’s contract with SPPC was priced in 2019 at P4.2455 per kilowatt-hour. The deal was the subject of a writ of preliminary injunction issued by the Court of Appeals, indefinitely suspending the power supply agreement.
Meralco’s first two EPSAs were supplied by Aboitiz Power Corp.’s GNPower Dinginin Ltd. Co. — Ashley Erika O. Jose