Charges readied vs 12 energy companies

by Alena Mae S. Flores – April 03, 2016 at 11:10 pm

from Manila Standard Today

The Energy Regulatory Commission will hire external lawyers to assist in the filing of cases against 12 companies that allegedly engaged in anti-competitive behavior in November to December 2013.

“The Commission has already decided on the mode of hearing the cases. We’re now putting in place the administrative requirements for the same and I will issue the appropriate office orders in the coming days,” ERC chairman Jose Vicente Salazar said.

“Based on our agreed timeline, the process will commence, at the latest, first week of May,” he said.

ERC’s investigating unit filed complaints in June 2015 against 12 companies for anti-competitive market behavior that led to price spikes during the Malampaya maintenance shutdown in November to December 2013.

“We want to emphasize that this is actually priority for us. So the IU cases will be prioritized over all other cases, we know the public is now awaiting our resolution with respect to this issue,” Salazar earlier said.

The companies include Power Sector Assets and Liabilities Management Corp. (for Malaya and Casecnan plants); Therma Mobile Inc.; Manila Electric Co., 1590 Energy; CIP II Power Corp; Trans-Asia Power Generation Corp.; AP Renewables, Inc.; Udenna Management Resources Corp; Strategic Power Development; GN Power Mariveles and SEM-Calaca Power Corp.

“I guess we have to already move on whether there is liability on the part of the respondents, whether we already say they are not liable at all,” Salazar said, adding ERC planned to wrap up the investigation before the end of the year.

Commissioner Gloria Victoria Yap-Taruc earlier said the rules of the ERC allowed the application of methods under the rules of court.

“We’re seriously considering a board, or a tribunal, composed of only three or a hearing officer. Just like division but not cast in stone yet, because we are also aware of what the limitations of the competition rules… We’re seriously studying what the constitutive body will be,” Yap-Taruc said.

The cases filed against the 12 companies for anti-competitive behavior for withholding capacity at the Wholesale Electricity Spot Market was the result of the report of the investigating unit that it completed after more than  a year.

The Electric Power Industry Reform Act of 2001 states that “no participant in the electricity industry or any other person may engage in any anti-competitive behavior including, but not limited to, cross-subsidization, price or market manipulation, or other unfair trade practices detrimental to the encouragement and protection of contestable markets.”

The Malampaya shutdown caused the spike in power rates for December 2013 and January 2014, prompting non-government groups and other petitioners to seek temporary restraining order with the Supreme Court.

The SC ruled in favor of the petitioners and stopped the implementation of the P4.15 per kilowatthour increase in power rates for the month of December 2013.