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LKI 2020-024 PRESS STATEMENT
May 10, 2020
FREEZE PROVISIONAL RATE OF SAN MIGUEL POWER SUPPLY CONTRACTS–LABAN KONSYUMER TO ERC
Vic Dimagiba , President of Laban Konsyumer Inc. issued a public statement today that three ( 3 ) separate Motions for Reconsideration were filed by the power plants owned by San Miguel , i.e. the San Miguel Energy Corporation and the South Premier Power Corporation , which claimed that in the determination of the provisional implementation authority, the Energy Regulatory Commission should have included the escalation clause of 3.5 % and the Plant Capacity Factor should not be measured at 100%.
On December 26, 2019, the Energy Regulatory Commission issued provisional authority in each of the 3 San Miguel Power Supply Agreements (PSA ) with Meralco in the identical amount of Php 4.0459/kwh ( exclusive of VAT and line rentals ).
The delivered rate of the 3 PSA are much higher than the provisional authority of Php 4.0459/kwh.
Further , any such new provisional amount should likewise retroact to December 26 2019, the power plants owner said.
The 3 San Miguel contracts, inclusive of VAT and line rentals , are as follows:
1. In ERC Case No. 2019-080 (South Premiere Power Corporation) for the supply of 290 MW mid merit power plant, the Delivered rate is Php 5.5348 /kWh and Php 5.7507 Levelized Cost of Energy.
2. In ERC Case No. 2019-081 (South Premiere Power Corporation) for the supply of 670 MW baseload power plant, the Delivered rate is Php 4.6314 and Php 4.9299 Levelized Cost of Energy.
3. In ERC Case No. 2019-083, (San Miguel Energy Corporation) for the supply of 330 MW baseload power plant, the Delivered Rate is Pup 4.6314 and Php 4.9299 Levelized Cost of Energ
The San Miguel power plants obtained 3 separate Power Supply Contracts from Meralco for a total of 1, 290 MW of power in compliance with the Competitive Selection Process .
Meralco had since collected the amount authorized by the ERC. In fact , Meralco customers already enjoyed a 50 centavos rollback in February in the implementation of the 6 new PSA, including the San Miguel plants.
Laban Konsyumer Inc. submitted a Manifestation to the ERC and supported the issuance of the provsional authority to ensure continous supply of electricity at the least cost , and presently , to maintain or freeze the status quo, i. e. Php 4.0459 /kwh ( exclusive of VAT and line rental ) each for the 3 San Miguel power plants .
The power plant owners have filed a Counter Manifestation against the LKI prayer for a price freeze or status quo .
The power plants claim that their rates are lower from Meralco’s expiring PSA as well as lower than the historical spot market prices purchases by Meralco. They also question why ERC used an unrealistic 100% plant capacity utilization factor, and ignored the escalation clause, in the computation of the provisional authority.