Meralco warns of widespread blackouts

The Philippines’ top electricity distributor says new sources of power are needed.

Manuel Pangilinan, Chairman of the Manila Electric Company or Meralco said the Philippines needs more power plants to support its economic growth.

“We do need more power plants in the country,” he said. “The margin of (supply) safety in Luzon is very tight, and unless we fire up our oil-fired plants, we will experience brownout in Luzon.”

Meralco president and chief executive officer Oscar Reyes said company sales grew 7.1% in 2012 on higher revenues from industrial, commercial and residential customers.

Reyes said that because of this, Meralco anticipates there would be increasing tightness in 2013-2016 until new power generating plants come in.

Reyes said the government foresees the need to add 3,000 megawatts in the next five years, taking into account an economic growth of only 4.5%.

To meet future needs, Meralco is building its own power plants with total capacity of about 2,900 mW from 2016 to 2019. Meralco has also entered into long-term bilateral contracts involving 2,880 mW. The new plants will represent 30% of Meralco’s total power requirements.

Philippine power producers have been urging the government to ensure sufficient, reliable and competitively priced power in anticipation of increase investments because of the Philippines’ surging economy.