Meralco asked to fix power dispute

by Alena Mae S. Flores – May 09, 2016 at 11:25 pm

from Manila Standard Today

The Energy Department ordered Millennium Energy Inc. and Manila Electric Co. to make 100 megawatts of power supply from the Navotas diesel-fired power plant available when required by the grid.

Energy Undersecretary Mylene Capongcol told reporters Energy Secretary Zenaida Monsada asked Millennium and Meralco in a letter to ensure the availability of power when needed by the power grid.

“Secretary Monsada sent a letter to them last Friday,” Capongcol said.n “The plant is on shutdown mode but it’s a fast start so it could immediately run if it is required to do so,” the official said.

Monsada earlier said she would sit down with Meralco and Millennium to resolve their dispute and allow the generation of 100 megawatts of capacity from the Navotas plant.

Monsada also wanted the Navotas diesel plant to provide additional capacity to during the election period.

“We will talk with them. The Millennium capacity will bring in additional [supply] comfort if it can be resolved,” Monsada said.

Meralco president Oscar Reyes said the company wanted to “find something that works for both parties.”

“We can sit down directly with them [Millennium]… We’ll try to see if we can enter into some kind of viable arrangement with Millennium,” he said.

ERC chairman Jose Vicente Salazar said Millennium’s dispute with Meralco revolved around the distribution wheeling services agreement on the diesel plant at the Navotas Fish Port Complex in Navotas City.

“The commission met with Millennium because they have a problem with Meralco, specifically their DWSA with Meralco,” Salazar told reporters.

Salazar said Millennium decided to stop supplying its capacity to the Wholesale Electricity Spot Market after incurring losses due to the exorbitant wheeling charges being charged by Meralco.

WESM, the trading floor of electricity, is operated by Philippine Electricity Market Corp.

“Millennium is embedded to Meralco so it is being charged the wheeling charges… This is one thing that is crucial with the agreement. Millennium will have to pay Meralco despite the fact that it is not earning from the market. It is like the highway that even if you don’t use it you pay for it and it is based on the capacity that you can actually offer to the market,” Salazar said.

Millennium has decided to rescind its contract with Meralco. Millennium notified PEMC that it would cease its membership in the WESM effective April 1.

“Millennium decided to rescind its contract [with Meralco]. It did not want to pay anymore saying that the contract was unreasonable,” the Salazar said.

He said Millennium’s output could have added to the grid, especially during the dry months when supply is tight due to low generation from hydro power plants.