MANILA — SMC Global Power Holdings Corp is still in a good position despite the Energy Regulatory Commission's denial of its proposed rate hike due to escalating global prices, its parent San Miguel Corp said Friday.

The petition for temporary relief of its fixed-rate power supply agreement (PSA) with Meralco was denied by the ERC citing its role of protecting the consumers from undue price changes.

“While we find the recent decision by the ERC denying our petition for temporary relief from skyrocketing global fuel prices unfortunate, SMCGP remains in a stable position to navigate these circumstances. We have never been more confident of the fundamental strength of our businesses,” SMC president and CEO Ramon S. Ang said.

Ang said the company remains fundamentally strong. It is even pursuing its expansion and transition plans to Battery Energy Storage and cleaner power technologies.

Although the denial will have a "significant" impact on the involved facilities, Ang said it would have no adverse effect on a consolidated basis on the company.

“We’re confident that we will be able to manage the company’s maturing obligations in 2023 and beyond. If necessary, there will be SMC parent support. For our bondholders, SMCGP will continue to be fully-compliant with its financial covenants at all times,” Ang said.

Its Battery Energy Storage System (BESS) project is seen to generate at least P8 billion to P10 billion in 2023 before interest, taxes, depreciation and amortization (EBITDA), he added.

In addition, the new Mariveles power plant is also expected to become operational which would add to the projected earnings, among other sources of relief next year, Ang said.

SMC said the company "continues to evaluate" legal remedies to possibly reverse the ERC ruling.

“The ERC ruling is a significant blow, not just to us, but more significantly, to the public, which will have to contend with higher electricity costs with the termination of the PSAs. That is why we are weighing all possible options,” Ang said.

Meralco has also downplayed the impact of the denied petition to its overall operations.

• PH energy regulator rejects SMC, Meralco rate hike petition
• San Miguel says to ensure power supply despite ‘crippling’ denial of rate hike appeal
• Meralco says junked rate hike petition will have no effect on operations

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