The Benguet Electric Cooperative (BENECO) and Limay Power, Inc. (LPI), a subsidiary of San Miguel Global Power, recently entered into a one year Emergency Power Supply Agreement (EPSA) to guarantee the continuous supply of quality electricity for the cooperatives growing number of consumers in the Baguio and Benguet areas.
The signing of the EPSA was in time for the lapse of BENECO’s long term power supply agreement with the Sual-based TEM Energy Corporation over the past 20 years.
BENECO general manager Engr. Melchor S. Licoben said that the EPSA saved us from the brink of disconnection as the National Grid Corp. of the Phil. (NGCP), the country’s transmission operator, gave notice on March 7, 2024 that BENECO’s substations will no longer receive electricity effective 12:01 PM on March 13, 2024. That was supposed to be today.
The NGCP issued the notice as a matter of protocol after receiving word from Team Phil. Energy Corp. (TPEC) that its 20 year power supply contract with BENECO will already end on the midnight of March 12, 2024.
“Honestly, we got worried a lot. Word was spreading fast that BENECO will be disconnected from the grid at 12:01 today. What could salvage the electric cooperative would be a new power supply contract or a proof that BENECO is a direct player in the Wholesale Electricity Spot Market (WESM). As of 8 AM yesterday, we did not have both,” Licoben stressed.
“But our prayers were answered. Around 10 AM yesterday, BENECO sat with San Miguel Global Power officials to put signatures on the dotted line. The EPSA was sent to the NGCP. In the afternoon, the transmission operator recalled the notice of disconnection,” he added.
The BENECO official pointed out that the EPSA was not a fly by night pact or one that was hurriedly and hastily executed just to stave off the threat of disconnection. The EPSA was the result of a series of negotiations with San Miguel only that the desire for its completion came just hours before disconnection.
According to him, The EPSA, as per rules of the Energy Regulatory Commission (ERC), is an agreement that is brief in nature – one year. It is resorted to by distribution utilities as a stop gap measure while trying to secure a new power supplier that could offer a long term contract. This means that BENECO must be able to complete a Competitive Selection Process (CSP) for a new power supplier within the next 12 months.
He asserted that BENECO has not been remiss in its bid to secure a new power supplier in anticipation of the exit of TPEC. It started its efforts as early as 2019. But the pandemic and subsequent intervening events beyond the control of BENECO haplessly placed BENECO in an unenviable position of not being able to come to grips with a new contract. BENECO thus had no option but to go for an EPSA. We hope that we can secure this year a new long term contract. We will do it with force and determination to slay any fear of disconnection among our member consumers,” Licoben said.
He explained that The EPSA is half the battle won. But it gave us a breath of relief. By Dexter A. See