194 big customers of Meralco switch power suppliers

by Myrna M. Velasco – March 9, 2017, 10:00 PM

from Manila Bulletin

Of the 431 contestable customers or classified big-ticket customers of Manila Electric Company (Meralco), about 194 had already exercised their freedom to switch to their preferred retail electricity suppliers (RES) under the voluntary retail competition and open access (RCOA) phase of the industry.

The utility firm indicated though that majority – or about 237 contestable customers – still stayed within the service enclave of its local-RES (L-RES) MPower.

It noted that these end-users have “relatively medium to high load factors” and have chosen MPower in underwriting their new retail supply contracts.

The power distribution giant reckoned that “the RCOA market has become and remains highly competitive, especially with new power supply in the market with the commissioning and commercial operations of new power plants.”

Meralco President Oscar S. Reyes indicated that the “power of choice” as exercised by the contestable end-users under RCOA’s voluntary state of enforcement just clearly manifests an evolving “new normal’ in the industry – that “the customer is king.”

The utility firm has maintained its position though that not setting a mandatory implementation of RCOA would cast the “true” meaning of choice – because that would be giving the end-users the option to stay with their servicing L-RES or switched to the other licensed entities.

Meralco Chairman Manuel V. Pangilinan indicated the very wide array of choices that qualified customers can sign up contracts with – either with the 24 L-RES entities or the 30 separately licensed retail electricity suppliers – holding it superior then to the relatively limited choices in the telecommunications industry.

Notably, the mandatory phase of RCOA had been stopped by the Supreme Court prior to its prescribed February 26, 2017 deadline – with the ruling effectively stopping the enforcement of a Circular and governing rules previously issued by the Department of Energy and Energy Regulatory Commission.

In a related development, case petitioners Ateneo de Manila University (ADMU) and San Beda College-Alabang stipulated their view that RCOA’s implementation must be done on voluntary basis.

San Beda College Alabang Director Fr. Aelred Nilo, OSB, said “it would be very difficult for academic establishments to meet the proposed deadline by ERC and DOE by February 26, 2017, forcing customers to enter into new retail supply contracts or otherwise suffer the consequence of being disconnected from the distribution utility or being made to pay a supplier of last resort a 10 percent premium between the higher contract cost and the Wholesale Electricity Spot Market.”

The premium set for SOLR, however, had been among the provisions already relaxed earlier by the DOE and ERC on their deliberations.