Taguig court stops bidding for Meralco power supply contracts

The Taguig Regional Trial Court stopped on Wednesday the Manila Electric Co.’s (Meralco) scheduled auction of contracts to supply 1,000 megawatts (MW) of additional power.

The bid submission deadlines for the 600MW and 400MW contracts were scheduled on Aug. 2 and 9, respectively.

Through a temporary restraining order (TRO) valid for 72 hours, the court granted the plea of the consortium operating the Malampaya gas field to stop the power distributor’s “competitive selection process.”

“Upon evaluation of the allegations contained in the verified complaint for injunction, it appears from the facts shown that great or irreparable injury would result to the plaintiffs-applicants before the writ of preliminary injunction could be heard,” Executive Judge Byron G. San Pedro said.

“In other words, there exists extreme urgent necessity for the writ as to warrant the issuance of a Temporary Restraining Order to prevent further damages to the plaintiffs’ interests, the government and the environment,” he added.

Plaintiffs’ arguments

The plaintiffs included Prime Energy, Prime Oil and Gas Inc, UC38 LLC, and Philippine National Oil Exploration Corp. which claimed they were excluded from the bidding to supply 600 MW and 400 MW of electricity, beginning in September next year.

The Malampaya consortium said the auction terms placed indigenous natural gas in an unfavorable position, in contradiction of existing laws. It added that the bidding process was “flawed, skewed or supplier-driven and grossly violative of existing laws, rules and regulations.”

Energy security threat

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The group also said the planned power deals could threaten the country’s energy security.

“Increased reliance on imported sources of fuel threatens the country’s energy security and energy sovereignty because these are greatly susceptible to a volatile market,” they claimed in an earlier petition.

Meralco, however, argued that any delay in the process could result in higher electricity rates.

“It is our mandate to ensure that we conduct these in a timely manner, as delay will expose our consumers to unnecessary burden in the amount of billions of pesos in the form of higher power rates,” said Jose Ronald V. Valles, Meralco head of regulatory management. INQ