Power firm urges Palace to resolve E.R.C. impasse

By Lenie Lectura - January 24, 2018
https://businessmirror.com.ph/power-firm-urges-palace-to-resolve-e-r-c-impasse/

The Aboitiz Power Corp. (AboitizPower) has appealed on Wednesday to the Duterte administration to immediately resolve the impasse plaguing the Energy Regulatory Commission (ERC), saying “a fair and functioning ERC is critical for the energy sector to work.”

“We are appealing to the national leadership to resolve the ERC issue as soon as possible so the commission can get back to work and act on many pending issues awaiting their decision,” AboitizPower President Antonio Moraza said.

In a text message, Moraza said the power group is appealing for the issuance of certificates of compliance (COCs), among others, for projects that will be completed soon. “We will be needing COCs for the projects that will be completed soon, plus PSA [power-supply agreements] for TVI [Therma Visayas Inc.], and as soon as possible for TMI [Therma Marine Inc.].”

He stressed that a working regulatory body balances the welfare of the paying consumers, interests of the private investors and the government’s desire for reliable and ample power.

But the Department of Energy (DOE) and the Wholesale Electricity Spot Market (WESM) have already agreed to allow power-generation companies with expired COCs, or with pending COC applications with the ERC, to operate and trade in the WESM.

This move is meant to address concerns on possible power-outage incidents if the ERC, whose four commissioners were suspended for a year, could not act on pending applications due to lack of quorum.

Energy Secretary Alfonso G. Cusi assured that he will not allow any disruption in the country’s power supply as a result of the delay in the processing of applications before the ERC, including COC applications.

“The move aims to protect electricity consumers by preventing disruptions in WESM transactions while the ERC issue is being sorted out,” Cusi said after approving the resolution on the agreement with the board of directors of the Philippine Electricity Market Corp. (PEMC), the operator of the WESM, last Thursday.

“The paramount consideration is the overall protection of public interest and the security of the supply of power. This is needed for the Philippines to meet its economic targets. This should take precedence over administrative issuances, especially when an administrative body is unable to act,” Cusi added.

The energy chief 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.

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.

“New plants will also be permitted to trade or submit offers to the WESM upon proof of completion of testing and commissioning and other requirements for the issuance of a COC.”

Cusi explained, “The COC is a requirement for the registration and continuing participation of generation companies in the WESM. About 26 generation companies with a total of 3,314.60-megawatts [MW] generator capacities have expired or have expiring COCs in 2018.”

“Additional new capacities of at least 720 MW are also expected to go on commercial operations within the next few months. If not allowed to participate in the WESM, the available electricity supply in the market will be curtailed, which can result in higher market clearing prices,” he added.

“As the summer months draw near, the use of electricity is anticipated to increase. The DOE is monitoring the situation to ensure the sufficiency of supply to meet the rising demand,” Cusi said.