Meralco
From Wikipedia, the free encyclopedia
The Manila Electric Company (PSE: MER and MERB), also known as MERALCO, is the Philippines' largest distributor of electrical power. The word MERALCO, is an acronym for Manila Electric Railroad And Light COmpany, which was the company's original name from 1903 to 1919.
MERALCO is the Metro Manila's only electric power distributor and holds the power distribution franchise for some 22 cities and 89 municipalities, including San Juan, Las Piñas, Quezon City, Malabon, Makati, Caloocan, Pasay, Mandaluyong, Parañaque, and Navotas.
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[edit] Early History
The city of Manila already had electricity since 1892, provided by La Electricista, the Philippine's first electric company. The company built a central power plant on Calle San Sebastian in 1895, and along with street lighting, had close to 3,000 residential customers by the end of its franchise.
[edit] American Occupation and Pre-War History
On October 20, 1902, the Second Philippine Commission began accepting bids to operate Manila's electric tramway, and by extension, providing electricity to the city and its suburbs. Detroit entrepreneur Charles M. Swift won the bidding by default as he was the sole bidder and on March 24, 1903, was granted the original basic franchise of Meralco.
In 1904, Meralco acquired both the Compañía de los Tranvías de Filipinas, a firm that operated public transportation and ran Manila's horse-drawn street railways, and added La Electricista. Construction on the electric tramway began that same year. In addition to acquiring La Electricista's Calle San Sebastian power plant, Meralco built its own steam generating plant on Isla Provisora which powered the streetcar system and eventually also the electric service. By 1906, Meralco's yearly power output capacity was around eight million kWh.
[edit] Public Transportation
Meralco built up a strong public transportation business in the decades leading up to World War II, building a 170-strong fleet of streetcars into the 1920s, before switching over to buses later in that decade.
[edit] Power Generation and Distribution
By 1915, electricity generation and distribution became the main Meralco's main income generator, overtaking its public transportation operations in terms of revenue. In 1919, it changed its official name to Manila Electric Company. By 1920, the company's power capacity had grown to 45 million kWh.
In 1925, MERALCO, was acquired by the utility holding company Associated Gas and Electric or AEGCO (reorganized as General Public Utilities Corporation or GPU in 1946), which had begun a massive expansion throughout the United States and Canada. With AGECO's financial backing, MERALCO began acquiring a number of existing utility companies in the Philippines, enabling the company to expand beyond its Manila city center base.
By 1930 MERALCO completed construction of the Philippine's first hydroelectric power plant, the 960-kilowatt Botocan Hydro Station. At the time, this plant was one of the largest engineering projects in Asia and constituted the largest single private capital investment in the Philippines. The additional capacity allowed the company to begin hooking up customers throughout the Metro Manila area.
[edit] Retail Enterprises
To drive demand for more power, Meralco also opened a retail store in order to sell electric home appliances.[citation needed]
[edit] World War II
During Greater East-Asia War, the Japanese Occupation Forces forcibly transferred all of Meralco's assets and holdings to the Japanese controlled Taiwan Power Company. By the end of the war, most of the former Meralco operations had been destroyed.
[edit] Post War Reconstruction (Nationalist Era)
After WWII, MERALCO's autobus franchise was sold to Halili Transport. In 1962, Don Eugenio López, Sr. acquired MERALCO and it finally became Filipino-owned. In buying Meralco, Don Eugenio demonstrated his belief that Filipinos could manage businesses even better than Americans. During 1962-72, he increased MERALCO's power generating capacity five times.
[edit] Martial Law Period
In 1972 President Ferdinand Marcos both instituted martial law in the Philippines and issued Presidential Decree No. 40 which forcibly nationalized the country's electric generation and transmission.
Don Eugenio López, who owned Meralco at the time, had both his sons kidnapped by the government who were released to force Don Eugenio to hand over his business empire. The regime arrested his son Eugenio López, Jr. (better known as Geny) on trumped-up charges of conspiring to assassinate the president. With his son held hostage, Don Eugenio was forced to give up his holdings in a group of companies worth several hundred million dollars, but Geny was not released from prison.
By decree, the ownership of the company stripped away from the López family and placed under a shell company called the Meralco Foundation, Inc., controlled by crony under the newly-created, government controlled Napocor.
By 1978 all of the Philippines' major power plants, including most notably those previously owned by MERALCO, were owned and operated by NAPOCOR. Control of the Meralco corporaton itself was seized by the Marcos Dictatorship, but was returned to its prior owners after the EDSA Revolution.
