Danessa Rivera (The Philippine Star)
- February 10, 2018 - 12:00am
MANILA, Philippines — Retail
electricity suppliers (RES) are asking the Department of Energy (DOE) to allow
them to operate despite pending and expired licenses due to the lack of quorum
at the Energy Regulatory Commission (ERC).
In a letter to Energy Secretary
Alfonso Cusi, the Retail Electricity Suppliers Association of the Philippines
Inc. (RESA) said they should be allowed to operate under the retail competition
and open access (RCOA) regime even with pending or expired licenses.
The group cited that the DOE and the
Philippine Electricity Market Corp. (PEMC) agreed to allow power generation
companies with expired or pending certificates of compliance (COCs) to operate
and trade in the Wholesale Electricity Spot Market (WESM).
“Our sector would need a parallel
issuance to ensure continued service to contestable customers (CCs) currently
contracted with a RES or local RES,” RESA said.
Under the RCOA regime, qualified
end-users in the Luzon and Visayas grids make up 33.86 percent of the system
peak based on ERC data as of October 2017.
But of those qualified, only 44.42
percent – or 917 CCs – of the contestable market, with a demand of 2,326.49
megawatts (MW) are contracted with RES.
Currently, there are 30 published
RES but seven of them have expired licenses with pending applications that have
yet to be acted upon by the ERC.
There are also entities that have
filed applications with the ERC for the issuance of RES license, RESA said.
“We note the previous circulars your
office has issued to ensure the continued operation of the supply sector,
however, with the current legal issues affecting the operation of the ERC, we
wish to seek your support for a measure that will provide a similar solution to
the supply sector,” the group told Cusi
Last month, the DOE and PEMC, WESM’s
current operator, made the decision to allow generation companies to operate
and trade in the spot market to ensure there will be no disruption in the
country’s power supply as a result of the delay in the processing of
applications before ERC, including COC applications, after the suspension of
its four commissioners.
Cusi had said about 26 generation
companies with a total of 3,314.6 MW generator capacities have expired or have
expiring COCs this year.
Under the DOE-PEMC resolution, power
generation companies with expired COCs can continue trading upon proof of
submission of their application for the renewal of their COC with ERC.
The COC is a requirement for the
registration and continuing participation of generation companies in the WESM.
Cusi had also directed PEMC and the
DOE to work closely with the ERC to ensure the continuing operations of
existing plants and to allow power generation from new plants that will be
completed.
Last December, the Office of the
Ombudsman ordered the suspension of ERC commissioners Alfredo Non, Gloria
Yap-Taruc, Josefina Patricia Magpale-Asirit and Geronimo Sta. Ana for one year
without pay for delaying the conduct of competitive bidding in securing power
supply agreements (PSAs).
The competitive selection process
(CSP) policy—which requires DUs and ECs to undertake competitive bidding to
secure PSAs with generation companies—was supposed to start in Nov. 7, 2015 but
implementation was moved to April 30, 2016 to give power players a transition
period to comply.
The Ombusdman said the delay in
implementation negated the policies contained under the Electric Power Industry
Reform Act of 2001 (EPIRA) and CSP resolutions to protect the interests of
consumers.
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