ERC, DOE commit to act on PSAs for power projects

By Myrna M. Velasco – April 10, 2019, 10:00 PM
from Manila Bulletin

With decrepit infrastructure and lack of firm investment commitments, the Department of Energy (DOE) and Energy Regulatory Commission (ERC) have finally been prompted to act on pending power supply agreements (PSAs) for energy projects.

In particular, the DOE indicated that it asked the ERC “to expediently work towards the realization of the PSAs of all committed power projects to ensure the security of our power supply reserves.”

Notably, the ERC is not strong and determined enough to decide on PSAs that are pending at the regulatory body – primarily the legally-impeded supply deals for power projects that are in contract with Manila Electric Company.

It can be culled that two of these power projects – the 1,200MW Atimonan and 600MW Subic are in the “committed power projects” list of the energy department.

The ERC is targeting to address such PSA applications after the issuance of verdicts by the Supreme Court on pending cases – and it is looking at mid-2020 as a possible decision timeframe.

Nevertheless, one of the ERC Commissioners will be retiring next year, hence, that may emerge as a reason again for the regulatory body to delay rulings. And even ERC Chairperson Agnes Devanadera does not have much time leeway because her term also ends in 2022.

With electricity supply in the country getting squeezed on the reserves sphere, Energy Secretary Alfonso G. Cusi indicated that his department is now collaborating with the ERC “to proactively work together on a twin approach to enhance the security and accessibility of power supply.”

Beyond lip service, however, it has yet to be seen if these two officials who are widely perceived in the industry to be in a “constant turf war” could finally harmonize their acts so the non-moving power projects could ultimately proceed to implementation phases.

Cusi enthused that “the ERC and the DOE share the same goal of making sure that our people would have sufficient, affordable and reliable electricity” – getting to that point though is the missing link in the energy chief’s pronouncements because gestation period of power plant projects take time; and the smorgasbord energy mix of this administration still appears to be obfuscated – with preferences still unclear whether to continually embrace coal, opt for indigenous gas or liquefied natural gas (LNG) imports or inject that much renewables in the power system.

The DOE chief further sounded off that “an effective partnership between the DOE and ERC is very crucial to the attainment of our energy goals – which is why we have been meeting regularly.”

Beyond the collaborative efforts it has been advancing with the ERC, the energy chief said he had instructed state-run National Power Corporation (NPC) on a push for “hybrid technology” for SPUG areas.

He admitted though that this is still under study phase; along with the entry of qualifying third parties (QTPs) in what had been classified as unviable areas.

Like a reminder to himself and his department, Cusi stressed “we cannot afford any further delays, especially when it comes to the sufficiency of our power supply and providing widespread access to electricity.”