The Energy Regulatory Commission (ERC) granted interim relief to Western Mindanao Power Corp. (WMPC), a subsidiary of Alsons Consolidated Resources Inc. (ARC), to start providing ancillary services to the Mindanao grid.

ERC chair Monalisa Dimalanta said in a mobile message to reporters that WMPC was granted a provisional authority to sell electricity for dispatchable reserves at P0.85 per kilowatt hour, among other ancillary power services.

WMPC, the primary electricity provider in Zamboanga City, had previously warned that its diesel-powered plant’s fuel supply is dwindling and could lead to power outages in the coming weeks.

The company’s 100-megawatt diesel-fired power plant may be forced to cease operations if the ERC delays its decision on WMPC’s application to supply ancillary services.

WMPC has applied to the ERC for a firm ancillary services purchase agreement (ASPA) with the National Grid Corporation of the Philippines (NGCP).

Higher losses without backup

Without the firm ASPA, WMPC estimates that its diesel power plant would incur approximately P50 million in losses from January to March 2024 due to its capacity not being prioritized for deployment.

For ACR deputy chief financial officer Philip Edward Sagun, the ERC’s interim relief provides the company an opportunity to implement the firm ASPA contract awarded to WMPC for dispatchable reserve, reactive power support, and black start service.

“Once key clarifications have been made with the ERC, the WMPC can continue providing electricity, thus supporting the much-needed grid stability and Zamboanga Peninsula, ensuring a reliable power supply. 

We are in the process of procuring the necessary fuel to ensure the uninterrupted operation of WMPC,” Sagun said during ACR’s annual stockholders’ meeting yesterday.

Nonetheless, Dimalanta reassured the ERC that the ASPAs awarded by NGCP are being diligently addressed by the commission as part of its ongoing development initiatives.

“We do not take lightly the requirement to approve whatever rates were awarded in the CSP (competitive selection process).” 

“We need to balance the requirement of the grid for system security with the impact of the awarded prices on the rates to be paid by consumers,” Dimalanta said.