By Madelaine B. Miraflor
Giant distribution utility Manila Electric Company (Meralco) has formally transitioned to a new leadership, with its new chief saying his company should not be “demonized” for pushing its multi-billion coal-fired power projects.
In an interview after the company’s annual stockholders meeting on Tuesday, Meralco President and Chief Executive Ray Espinosa justified Meralco’s plan to push for its coal-fired power projects like the 1,200-megawatt (MW) Atimonan project in Quezon Province.
“We should not demonize Meralco basically because of the way our supply is sourced. The government didn’t come up with a law or regulation that prohibits absolutely coal,” Espinosa said.
“I don’t think we can say days of coal are numbered until we basically hear from the government as to what is the policy. We are also constrained to look at coal as a source of supply mainly because DUs [distribution utilities] have statutory obligation to secure supply that has the least cost. Coal has the least cost so we are obligated by law to source from coal,” he added.
Espinosa said that despite the recent Supreme Court (SC) ruling that would require Meralco to start from scratch when it comes to securing power deals for its Atimonan project, the company would still attempt to pursue the US$3-billion coal project through it power generation arm Meralco Powergen Corp.
To recall, SC ruled that “all deals or PSAs [power supply agreements] submitted by distribution utilities or the power companies to the ERC [Energy Regulatory Commission] on or after June 30, 2015, must undergo a competitive selection process.”
This means that all DUs like Meralco should enter into a competitive selection process (CSP) before awarding its PSAs to generation companies.
“[The recent SC decision] could delay the construction of a much needed power plant, [but] we will respect the decision of the SC and we will heed the direction as well as we will follow the competitive selection process and we would build as quickly as we can in coordination with and the approval of the DOE,” Espinosa said.
Meanwhile, Espinosa said Meralco is in discussion with “less than a dozen” renewable energy (RE) proponents as part of its efforts to somehow reduce its dependence on coal.
“We are in discussions with some solar and wind proponents. We are not moving away from the goal of reducing our carbon footprint. We have a responsibility as corporate citizen too,” Espinosa said.
It was just late in January when it was announced that Espinosa will takeover Meralco, replacing its long time chief executive, Oscar Reyes.
During Meralco’s annual stockholders meeting held on Tuesday, Espinosa officially took the helm at the country’s largest distribution utility.
Espinosa said the biggest challenge he thinks he would face would be the regulatory environment in the energy sector.