Regulator approves Ferro Energy’s retail sales permit

Manila Times.net
Published : Monday, November 21, 2011 00:00 Written by : EUAN PAULO C. AÑONUEVO


THE Energy Regulatory Commission has approved the application of a new retail electricity supply player.


Zenaida Cruz-Ducut, ERC chairperson and chief executive officer, said they gave Ferro Energy Inc. the country’s 16th RES license.


“This bodes well for our economy as it is an economic principle that true and healthy competition happens when there is a good number of suppliers playing in the market,” she said.


Ferro Energy is a newly-organized private corporation wholly-owned by Cathay Pacific Steel Corp. It plans to supply the energy requirement of CAPASCO and its affiliates upon commencement of open access.


Ferro Energy plans to participate in the Wholesale Electricity Spot Market after securing its RES permit.


A holder of an RES license is an entity authorized to sell, broker, market or aggregate electricity to contestable market customers in a regime of retail competition and open access.


Upon the initial implementation of open access, the ERC shall allow all electricity end-users with a monthly average peak demand of at least one megawatt for the preceding 12 months to join the contestable market. These consumers will be allowed to choose their suppliers, a departure from the present practice of distribution utilities buying on their behalf.


The threshold level for the contestable market shall be reduced to 750 kilowatts two years thereafter and every year onwards. The ERC will gradually reduce the threshold until it reaches the household demand level.