The Energy Regulatory Commission said Tuesday it will review the effect of the $3.3 billion liquefied natural gas transaction between three of the country’s biggest power firms if there is any impact on consumer prices.
ERC chairperson Monalisa Dimalanta said the review of the merger falls under the mandate of the Philippine Competition Commission.
Meralco PowerGen Corp., Meralco subsidiary and Aboitiz-owned Therma NatGas Power, Inc. recently entered into an investment agreement to acquire equity interest in Chromite Gas Holdings (CGHI) that will pave the way for their investment in LNG assets valued at $3.3 billion.
MGen will acquire 60 percent interest while TNGP will acquire the balance of 40 percent in CGHI.
CGHI intends to invest in two gas-fired power plants owned by San Miguel Global Power Holdings Corp. (SMGP) and an LNG import and regasification terminal owned by Linseed Field Corp.
“ERC will review the effect, if any, on the present and future PSAs (power supply agreements) of Meralco and behavior of players in the WESM (Wholesale Electricity Spot Market) and retail market,” Dimalanta said.
She said ERC is waiting for more information, particularly as regards the results of recent competitive selection process of Manila Electric Co. and pursuant to other mandates of the commission.
“There has been a standing arrangement for coordinated review since 2019. We just operationalized the agreement by setting up the joint inquiry team last month,” Dimalanta said.
The ERC and the PCC announced in February the launch of a joint task force to monitor and investigate allegations of anti-competitive practices in the power sector.
This initiative builds upon the 2019 agreement between the two regulators to foster competition in the energy industry in response to concerns about power outages and corresponding increases in prices of electricity.
These joint fact-finding inquiries aim to uncover anti-competitive conducts that harm consumer welfare, ERC said.
“The broader expertise of the PCC on reviewing arrangements and behavior with a competition lens complements the energy industry-focus of the ERC. This synergy allows our respective agencies to better fulfill our mandates and serve the Filipino public,” Dimalanta said.