The power generator expects to be busy with Terra Solar in the next three years.
Meralco PowerGen. Corp. (MGen) may replicate its 3,500-megawatt (MW) solar project worth $4b in northern Philippines if it proves to be as competitive as a mid-merit coal plant, which adjusts its power output as demand for electricity fluctuates throughout the day.
The company might lower the capacity to 300 to 400 MW depending on the power grid’s demand, MGen President and CEO Emmanuel Rubio told Asian Power in an interview.
“I don't want to call it a proof of concept because I'm sure we can do it,” he said, referring to MGen’s Terra Solar project, which is expected to go online in 2026.
“But if this project as is, as it is turning out to be… as competitive as a mid-merit fossil fuel plant in providing mid-merit supply for a significant capacity, then I think we need to look into other opportunities and mimic a Terra Solar one, right?”
The first phase of Terra Solar, which features a 4,500 megawatt-hour energy storage system, is expected to be finished by February 2026, and the second phase in 2027. It will provide electricity to about 2.4 million households and cut carbon emissions by 3.6 million tonnes a year.
Rubio said Terra Solar would keep the company busy in the next two to three years. MGen, a unit of Manila Electric Co., has issued an invitation to bid for the engineering, procurement, and construction of the east and west sides of the project’s 2,500-MW first phase.
Once the initial phase is completed, Rubio said MGen would look for ways to optimise the setup of providing mid-merit supply, which fills the gap between baseload and peak demand.
“There is a co-optimised market in the Philippines,” he said, referring to the practice of optimising electricity service to reach the most cost-effective energy mix whilst maximising resource use.
“Maybe we can look at Terra Solar participating in providing reserves in the co-optimised market, which was not considered in the original base case so it will just add value to the project,” he added.
The MGen group has a total power generation capacity of 2,425 MW across coal, liquified natural gas (LNG), diesel, and solar technologies. It can supply base, intermediate, peak load, and ancillary support.
Coal and gas
Aside from renewable energy, MGen is also exploring opportunities in traditional energy sources such as coal, which the company believes is critical to energy security amidst a global push for clean sources.
In September, MGen asked the Department of Energy (DoE) to exempt its Atimonan plant from the coal moratorium issued in December 2020. Once issued, the company can proceed with its 1,200-MW coal-fired power plant in the province.
“We've also received interests from a number of parties to supply us with supercritical coal, so they're still out there,” Rubio said, adding that there is also interest amongst local banks to fund the project.
“Once we have hurdled the approvals, the permitting, especially the DOE endorsement, then we can really go out there and see,” he said “I'm sure there's a market, but how much would that be?”
MGen is also awaiting the decision of the Philippine Competition Commission on its participation in the acquisition of San Miguel Corp.’s 1,278-MW gas-fired Ilijan power plant.
Once approved, Rubio said MGen will own 67% of the facility and supply Meralco with its base load requirement — the minimum level of electricity demand required over a period, in renewable energy.
Another focus for MGen is energy exports.
Singapore’s PacificLight Power Pte. Ltd. would participate as a 36% owner of an entity that plans to export 600 megawatts of pure renewable energy to the city-state from Indonesia, he said. MGen owns 58% of PacificLight.
“We're still negotiating, very early days, but the delivery is expected to be around 2029,” the MGen CEO said.
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