Fuel contract award to Malaya plant set

by Myrna Velasco – July 30, 2016

from Manila Bulletin

With both the Departments of Energy and Finance averting power interruptions, an awarding of contract on industrial fuel for the 650-megawatt Malaya thermal power plant is already being set by the Power Sector Assets and Liabilities Management Corporation (PSALM).


PSALM Officer-in-Charge Lourdes S. Alzona said approvals were already anticipated from both key agencies, thus, the feared fuel run-out at the Malaya plant may still be avoided.

She noted that winning supplier Phoenix Petroleum Philippines, Inc. is ready on fuel deliveries once PSALM secures all the necessary approvals and upon awarding of the contract.

The oil firm has to supply 30.33 million liters of industrial fuel for the Malaya plant’s requirement for this year.

The Davao-based oil firm’s calculated bid of R373.159 million had been declared the winning offer in the auction that PSALM has undertaken on the facility’s fuel needs. PSALM raised alarm bells on Malaya plant’s threatening fuel depletion that could compound the problems of supply deficit in the Luzon grid.

The Malaya power plant has a critical role because it serves the must-run unit (MRU) requirement of the power system – in short, it has been intended as the grid’s recourse for security capacity.

On Friday, Luzon grid was officially placed on ‘red alert’ condition – or the phase when rotating brownouts have been anticipated. Rolling power service interruptions were expected from 1:01 p.m. to 4:00 p.m.

However, according to the Manila Electric Company (Meralco), as of:3:30 p.m., the system held and no power interruptions happened because they were able to call on the participants of their interruptible load program.

Meralco spokesperson Joe Zaldarriaga said about 252 megawatts of capacity from ILP participants had been activated, hence, preventing the dreaded rolling power interruptions.

The energy department indicated it is “reinforcing efforts to ensure continuous power supply in the country” by requesting the Energy Regulatory Commission (ERC) to look into the recurring yellow and red alert conditions in the system.

On Energy Secretary Alfonso G. Cusi’s part, he enthused that ERC was specifically asked “to look into whether there is the existence of anti-competitive behavior from industry players.”