By Victor V. Saulon, Sub-Editor

MANILA Electric Co. (Meralco) is looking outside its franchise area to build microgrids similar to its hybrid system on Cagbalete Island, company officials said.

“We also plan to bring this outside our franchise area so we can also help the DoE (Department of Energy) and government in providing electrification to other parts of the country using the same solution,” Ray C. Espinosa, Meralco president and chief executive officer, told reporters on Tuesday.

Meralco Chairman Manuel V. Pangilinan confirmed the power distribution utility’s plan to replicate the system in other areas.

“There are several islands we’re looking at still,” he said about introducing more microgrid systems, or small-scale power grids that operate independently from the mainland’s interconnected power transmission and distribution network.

On Tuesday, Meralco launched the power microgrid in Cagbalete, a fishing island village and an expanding tourism spot in Quezon province, after completing a hybrid generating plant that features 60 kilowatt-peak (kWp) solar photovoltaic system, 150-kWh battery energy storage, and two units of 30 kW diesel generators.

Initially, the microgrid will provide 24/7 power to around 200 households in Cagbalete, a 1,795-hectare waterlocked island with two barangays.

Mr. Espinosa said within the year, the remaining 600 families as well as the establishments and resorts on the island would be energized.

Yesterday’s launch was held at Grand Hyatt at the Bonifacio Global City, with a simultaneous ceremony in Cagbalete. Meralco previously launched a hybrid generating power plant in Verde Island in Batangas province.

Mr. Espinosa said Meralco’s plan is not just to provide a system using innovative and integrated hybrid solution but also to ensure stable power to the grid.

Energy Regulatory Commission (ERC) Chairperson and Chief Executive Officer Agnes VST Devanadera said Meralco was making itself “more relevant” by venturing into microgrid systems that are high in cost but low on investment recovery.

“There is a growing sensitivity to respond to the growing needs,” she said during the event. She expects the cost of power in Cagbalete to go down from its existing P55 per kWh.

The launch comes a day after President Rodrigo R. Duterte said in his State of the Nation Address on Monday that the country should lessen its dependence on coal as a power source to more renewable energy (RE).

Mr. Pangilinan said the call was a “happy coincidence” as the microgrid was “partly CSR (corporate social responsibility.” One Meralco Foundation is a partner in the project by bearing a portion of the cost that residents to shell out to get connected to the power distribution system.

“Power is an enabler. What the people need there is clean water. At the moment there it’s deep well. We need to put up a water treatment plant to clean the water,” he said.

“Number two, I noticed fisherfolks, the main industry is fishing. We need to put up a cold storage plant,” he said. “And of course tourism facilities — the huts, a place where people can stay overnight or several nights.”

On the sidelines of the event, Mr. Pangilinan told reporters that he expects Meralco first-half income to be better than last year’s.

He declined to say by how much, but said: “It’s helped by the volume.” He was referring to the sales in kilowatt-hours.

He does not expect a double-digit growth in the first half, but noted it is “better than historic average.”

Meralco will report its financial performance in the first semester on Monday. In the first half last year, its consolidated core net income rose 7% to P10.9 billion, while reported consolidated net income increased by 14% to P12 billion. Revenues reached P150.5 billion, up 7%, while volume of energy sold was at 21,665 gigawatt-hours, also higher by 7%.