Conglomerate San Miguel Corp. unveiled yesterday an extremely vague offer, seemingly as a way out of the impasse on the electricity rate increase controversy that confounded both Energy Regulatory Commission chairperson Atty. Monalisa Dimalanta and consumer groups.

The bottom line, according to both the ERC and consumer groups, is that SMC must comply with the competitive selection process and the power supply agreement that will be reactivated once the 60-day Court of Appeals temporary restraining order on the power supply agreement between South Premiere Power Corp., which runs Ilijan and Meralco, lapses.

SMC offered Meralco yesterday the use of the Ilijan plant "at minimal tariff to help stabilize power supply, and push down energy bills."

The Ilijan natural gas plant is owned by SMC unit SPPC which obtained a TRO on the ERC decision to dismiss SMC's adjustment petition that, in effect, suspended the PSA for that.

SMC said its power unit, San Miguel Global Power, has offered to make the full capacity of its Ilijan natural gas plant available to Meralco "for a fraction of its capital cost" to help keep electricity prices as low as possible for consumers while ensuring a steady supply of power in the coming months.

SMC president Ramon S. Ang said that the offer, covering the full 1,200 megawatts capacity of the plant will only cost Meralco a minimal P1 per kilowatt hour in capital recovery fee, or half of its capital cost on the facility.

Both Dimalanta and Power for People Coalition convenor Gerry Arances were iffy in their response to SMC's proposal.

Dimalanta said she needed to review the proposal "to understand better what this deal is about."

"I'm not sure I understand yet what the offer or deal is: Is it a supply offer? An asset offer/sale? If it is for supply, then Meralco already has two PSAs with SPPC for the supply (baseload and mid-merit) covering almost the entire capacity of Ilijan. These are the fixed price PSAs, one of which is subject of the current case with the Court of Appeals," Dimalanta added.

"If SMC will not get a permanent injunction or a preliminary one, then after 60 days, the PSA will be reactivated, and SMC is obliged to resume supply. Or they terminate the PSA, which means that they have to follow the ERC order and what is stipulated in the order," Arances said in response to a Daily Tribune query.