Tight power supply expected to persist next year

TWO of the country’s largest electricity distributors expect the tightness in power supply to continue next year, although some relief may be provided by the completion and return to operation of some power plants.

“It’s still gonna be tight kasi wala naman bagong planta (because there is no new plant) except maybe the Excellent plant of San Miguel. It’s scheduled to be completed by the end of next year so ang pasok nun (it will come online by) 2025 pa,” Manila Electric Co. (Meralco) Chairman and Chief Executive Officer (CEO) Manuel V. Pangilinan told reporters last week.

Excellent Energy Resources, Inc. — a subsidiary of San Miguel Global Power Holdings Corp. (SMGPH), the power arm of conglomerate San Miguel Corp. — is putting up a 1,750-megawatt (MW) power facility in Batangas City.

Asked if the plant will be able to keep pace with the expected growth of the economy, Mr. Pangilinan said: “It’s always good to have surplus power.”

“If you don’t have a surplus capacity, you will face bouts of tightness which we don’t want to see,” he said about putting “permanent pressure on prices downward.”

“As a distributor, we want to see good margins of supply to demand,” he said.

Currently, Meralco is rebidding the procurement of its 1,800-MW power requirement, which was supposed to be supplied by Excellent and another SMGPH subsidiary, Masinloc Power Partners Co. Ltd.

The San Miguel units’ contracts with Meralco were terminated earlier this year. The Energy Regulatory Commission had approved the withdrawal of the application for the power supply deal as the agreed time frame to complete the required conditions had lapsed.

Aboitiz Power Corp. (AboitizPower) President and CEO Emmanuel V. Rubio said the country’s electricity supply next year might still be enough to cater to the growing demand amid the return to operations of the Ilijan natural gas-fired power plant.

“I think [supply will be] just like this year, although there’s going to be growth in demand, maybe 600 to 700 MW. Ilijan is offering so I think there would be ample supply,” Mr. Rubio separately told reporters last week.

The 1,200-MW Ilijan power plant of SMGPH has resumed operations and has been reintegrated into the grid in June after the fuel supply from the Malampaya gas field stopped.

The Batangas power plant went offline on June 5 last year following the ceasing of gas supply deliveries from the depleting Malampaya natural gas facility under the Service Contract 38 consortium.

“Although the forecast is El Niño, it’s still going to be tight, especially during summer, but I think we will have ample supply,” Mr. Rubio said.

“Maybe there will be times when diesel plants will be dispatched but it’s good that Ilijan is now running unlike in early 2022,” he said, adding that the “variable” would be hydroelectric plants also running to ease the situation.

Meralco is the main power distributor for Metro Manila and nearby areas. AboitizPower owns more than eight power distribution companies, including the country’s second and third largest.

AboitizPower has allotted P50 billion for its capital expenditure budget next year, which is mostly for the expansion and construction of its renewable energy projects. — Sheldeen Joy Talavera