Danessa Rivera (The
Philippine Star) - May 11, 2019 - 12:00am
MANILA, Philippines — The Energy
Regulatory Commission (ERC) warned of dire implications for the power industry
if the Supreme Court decision requiring competitive bidding for all power
supply agreements (PSAs) is implemented.
According to the ERC, the SC ruling
could lead to power supply shortage, affecting millions of consumers.
The ERC is currently collating
actual inventory of the PSAs affected by the blanket order of the High Court,
which was announced only through its Public Information Office (PIO).
Based on initial findings of the
commission, close to 100 contracts are covered by the SC decision, ERC
chairperson Agnes Devanadera said in a briefing yesterday.
“As we see from the SC statement,
the period covered dates back to June 30, 2015,” she said, noting some of which
have already lapsed and others are still being implemented.
In the circular issued by the
Department of Energy (DOE), the agency mandated all distribution utilities to
conduct competitive selection process in securing PSAs effective June 30, 2015.
But this was set aside when the ERC
issued a resolution on Oct. 20, 2015 stating that DUs may adopt any accepted
form of CSP pending formal process from the regulator.
The resolution also directed DUs to
comply with the CSP policy starting Nov. 7, 2015, but this was deferred further
to April 30, 2016 to allow a transition period for power players.
ERC commissioner Catherine Maceda
said the SC decision would have massive implications, both positive and
negative.
“It will really affect the supply
scenario considering the problems we have now during the summer season.You can
just imagine if suppliers are asked to stop supplying due to the SC
decision,” she said.
There will also be cost-recovery
implications because some of the PSAs have already been implemented and have
already lapsed.
“There will be implications on
collections because, based on the SC statement, the cost recovery is based on
the result of CSP, which will happen after the fact the plants are already
delivering service for the past three years,” Maceda said.
“All these plants operated on the
assumption they will be paid under a certain rate based on a prior
approval of the ERC,” she said.
The only positive effect of the SC
decision is that transparency will further be promoted in the power industry,
she said.
Devanadera, however, said the
commission is still waiting to receive the actual SC decision, which has yet to
be released, to check the details and nuances of the order.
“I cannot believe that the SC will
go for something disastrous. If we do a strict and literal implementation of what
we’ve read in parts…
It will affect millions of people.
This will be a real acute shortage in supply,” she said.
The ERC will be presenting to the SC
all the supply and cost implications of its directive.
On Thursday, the ERC summoned the
concerned electric power industry stakeholders and required them to submit
information that will enable the agency to assess the possible impact of the SC
decision.
The power regulator required them to
submit details of the procurement process of the contracts affected, including
supporting documents; list of existing major/critical loads to be affected,
other local/locational circumstances to be considered in relation to supply
stability, actual monthly amount paid for the contracts involved, actual
historical customer profile (from June 2015 to December 2018) and projected
supply-demand scenario (2019 to 2026) by May 15.
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