A consumer rights lawyer and power industry advocate described the temporary restraining order (TRO) against Manila Electric Company's (Meralco) competitive selection process for supplying 600 MW and 400 MW to electricity consumers as anti-consumer and anti-competitive.
Atty. Andres P. Manuel, Jr., said, "Prime Consortium is suing the wrong entity. Meralco is not soliciting offers from fuel suppliers in its conduct of the 600 MW and 400 MW CSP." In expressing his observations, Atty. Manuel clarified that "he has no intention of swaying the Court's appreciation of the outcome of the case and the public in general."
At a summary hearing last week before the sala of Judge Antonio M. Olilvete of the RTC Branch 267 for the extension of the TRO against Meralco's CSP, Prime Energy Resources et al. (Prime Consortium) filed a Complaint for Injunction with Prayer for issuing a TRO.
Before this, Prime Consortium was granted a 72-hour TRO issued on July 31 by the Office of the Executive Judge of the Regional Trial Court of Taguig City, thus preventing Meralco from further conducting the CSP for 600 MW and 400 MW supply.
Manuel was among the parties intending to intervene in the case. The consumer advocate stated, "From my participation in the proceedings before the Regional Trial Court on August 2, it was made clear by the plaintiffs' witness that their fuel prices in the form of indigenous natural gas (ING) are higher than imported liquefied natural gas, and that logically, higher fuel costs would result to higher electricity prices to be offered by their client-generating companies."
He added that "this claim for preference in favor of ING was not intended to tie the hands of Meralco in carrying out its mandate to source supply for its captive market in the least cost manner. Otherwise, the entire process of bidding among the power suppliers to avoid monopoly in the trade as originally envisioned by the law's framers will be set to zero."
It will be recalled that on January 23 this year, Meralco conducted a bidding process for 1,200 MW. Bidders for both coal-fired and natural gas-fired plants submitted their offers. Among the bidders was First NatGas Power Corp., a client of Prime Consortium.
First NatGas's price offer for the said bidding was considerably higher than the lowest bid for that CSP by about P1.37 per kWh. This confirms Prime Consortium's witness statement that their supply would ultimately result in higher consumer shouldering rates.
According to Manuel, this Prime Consortium claim of preference will undoubtedly lead to a higher and more expensive electricity cost for consumers within the Meralco franchise area.
It was also made clear that Prime Consortium is seeking the revision of the Meralco Terms of Reference for both the 600 MW and 400 MW CSP so that the bidding would favor generating companies sourcing ING over all others, even if their prices are higher—which is both anti-consumer and anti-competitive, he added.
It should be noted that all distribution utilities are required by law (Section 23, R.A. No. 9136) to supply electricity to their consumers in the least cost manner. In this case, Prime Consortium is effectively strong-arming Meralco to violate its least-cost mandate under the EPIRA.
"Nonetheless, the facts remain obvious: Meralco solicits power producers' offers. If Prime Consortium's client or clients would not use its more expensive fuel (ING), this brings us to whether Prime Consortium would fault Meralco for this, again raising this claim of preference," Manuel said.
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