As its transition supply contract with National Power Corporation (NPC) already nears expiry date, utility giant Manila Electric Company (Meralco) bared plans of reviewing its supply procurement options so it can corner competitive rates for its customers.

From now until 2011, we are safe. But since our TSC with NPC will lapse by then, we will need to review our supply sourcing strategy, Meralco president Jose P. de Jesus said.

The company’s five-year TSC with the state-run power firm will expire in 2011, or one year after the introduction of open access, whichever comes earlier.

We still have contracts with our IPPs (independent power producers) and we source part of our requirements from the WESM (Wholesale Electricity Spot Market), so the adjustments we will make will just be for the portion covered by our TSC. We may still opt to renew it, Jesus said.

With power demand crunch, he noted that availability of supply will not be a concern for now, it is just a matter of strategy what shall be taken as a more cost-effective option for Meralco customers.

The company has been the favorite target of power project developers for new bilateral contracts, but Meralco has not been giving in to offers due to the very volatile condition of the market.

Several factors will influence the decision of the utility firm on whether or not it will still get new supply contracts, primarily the timeline of open access and how the transition would be to full retail competition.