Manila Electric Co. (Meralco) has secured the best offers for its 600-megawatt (MW) baseload requirement at below P5.60 per kilowatt-hour (kWh), locking in competitively priced long-term supply for customers starting in 2028.

The power distributor said Tuesday that Mariveles Power Gen Corp. (MPGC), Sual Power Inc. (SPI) and GNPower Mariveles Energy Center (GMEC) emerged with the lowest bids during Meralco’s government-mandated Competitive Selection Process (CSP), with each offering 200 MW to complete the utility’s requirement.

MPGC submitted the lowest total levelized cost of electricity (LCOE) at P5.3573 per kWh for 200 MW, followed by SPI at P5.4357 per kWh for another 200 MW.

GMEC, meanwhile, initially offered the entire 600-MW requirement at P5.5789 per kWh before reducing its offered capacity to 200 MW, allowing the three lowest bidders to evenly split the supply requirement.

All offers were inclusive of value-added tax and a capped line rental charge.

The auction gives Meralco a clearer line of sight on its baseload supply beginning in 2028, while the competitive bids could help contain generation costs passed on to customers once the contracts take effect.

The resulting power supply agreements (PSAs) will run for 15 years, with the first 300 MW targeted for delivery by Feb. 26, 2028 and the remaining 300 MW beginning Feb. 26, 2029.

The three offers emerged from a field of six bidders that submitted qualification documents, technical proposals, and bid prices by the Sept. 1 deadline. Nine companies had initially expressed interest in joining the CSP.

Masinloc Power Co. Ltd. offered P5.6290 per kWh for 200 MW, while Therma Luzon Inc. submitted a bid of P5.6988 per kWh for 194 MW.

Except for Energy Development Corp., all offers received were below the reserve prices set for the CSP, according to Meralco’s Bids and Awards Committee for Power Supply Agreements (BAC-PSA).

All submissions underwent a pass/fail completeness assessment and pre-qualification evaluation.

“The Meralco BAC-PSA has fully complied with its mandate to conduct the bid in an open and transparent manner to achieve the least cost of electricity in accordance with rules and regulations set by the Department of Energy and the Energy Regulatory Commission (ERC),” Meralco BAC-PSA Chairman Lawrence S. Fernandez said.

The bidding was witnessed by consumer groups and representatives of the Philippine Competition Commission, while the proceedings were also streamed live on Meralco's YouTube page.

The three lowest bids, however, are not yet final, as they still have to undergo post-qualification before the winning suppliers are formally selected.

“The BAC-PSA will conduct a post-qualification evaluation and submit its recommendation and report to Meralco’s Board of Directors for approval of the best bids as the winning power suppliers prior to the issuance of Notices of Award,” Fernandez said.

Once awarded, the resulting 15-year PSAs will be submitted to the ERC for review and approval before the new supply can be implemented.