San Miguel Corp. (SMC) through its subsidiary SMC Global Power said it will not withhold its available power capacity to the Manila Electric Co. (Meralco) despite the Energy Regulatory Corp.’s (ERC) decision denying a joint request for a temporary power rate adjustment in view of fuel price spikes.
However, the conglomerate said it will explore legal remedies.
The ERC denied the joint motions through a majority vote of three commissioners and two other commissioners with dissenting votes in a decision dated September 29 and released Monday night.
The joint request sought for a temporary and partial cost recovery relief only for the losses incurred by SMC from January to May 2022, mainly due to the unprecedented spike in the cost of coal and natural gas — the types of fuel utilized by the company’s power plants to supply 1,000 megawatts (MW) worth of electricity to Meralco.
“We regret the ERC’s denial of our joint petition with Meralco for temporary relief on our 2019 power supply agreements (PSAs), not so much for our own interest but more for the consumers. The temporary relief would have enabled us to preserve few of the last remaining fixed-rate PSAs of Meralco that are responsible for keeping power rates in Metro Manila low compared to other parts of the country, amid surging global fuel prices,” SMC said in a statement yesterday.
SMC added based on Meralco’s own computation which was validated by ERC’s Regulatory Operations Office, the interest of consumers would have been best served with the approval of the joint petition.
“In the meantime, we will do everything we can to make sure Meralco’s energy supply is not disrupted. Despite the present challenges, we will never withhold our available power capacity to the detriment of the country and the consumers. However, given the circumstances, we will continue to explore other legal remedies to allow us to sustainably provide for the increasing power needs of our country while meeting our obligations to our various stakeholders,” SMC said.
SMC said moving forward, it will remain focused on maximizing its existing power assets while investing in technologies that will facilitate the transition to cleaner energy. – Jed Macapagal
