ERC extends deadline for contestable consumers to choose power supplier

By Lenie Lectura – 

from Business Mirror

THE Energy Regulatory Commission (ERC) has moved to extend the deadline for contestable customers with at least 1 megawatt (MW) of electricity consumption in a month to choose their own electricity supplier from December this year to February 2017.

In a draft resolution, the commission proposed “an end-user with an average monthly peak demand of at least 1 MW is hereby mandated to enter into a retail-supply contract with a retail electricity supplier (RES) by its mandatory contestability date of February 26, 2017.”

ERC said the proposed extended timeline is meant “to provide contestable customers time to negotiate their respective retail-supply contracts.”

“Pursuant to its mandate to promote competition and protect customer interests under Republic Act 9136, otherwise known as the Electric Power Industry Reform Act of 2001, the ERC hereby resolves to amend the timeline set forth in the second paragraph of Section 1.1, Article II of the Revised Rules for Contestability,” the ERC said.

The commission is now soliciting comments from industry stakeholders. Interested parties are given until November 8 to submit their comments.

The proposed extension comes after the Supreme Court (SC) issued a temporary restraining order (TRO) last month preventing Branch 157 of Regional Trial Court of Pasig City from continuing with the proceedings in the Special Civil Action 41449-PSG and from enforcing all orders, resolutions and decision rendered in the said case, effective immediately until the petition is finally resolved.

Since then, the ERC said it has received inquiries from contestable customers and distribution utilities seeking confirmation on the actual implementation of the mandatory contestability.

The Manila Electric Co. (Meralco) filed with the same local court a TRO and/or writ of preliminary injunction against the issuances of the Department of Energy (DOE) and the ERC, particularly assailing Sections 2 and 3, Article I of the 2016 Revised Rules Governing the Issuances of Licenses to RES and Prescribing the Requirements and Conditions, therefore; the Revised Rules for Contestability; and, the Resolution Imposing Restrictions on the Operations of Distribution Utilities and RES in the Competitive Retail Electricity Market.

On July 13 the same court granted Meralco’s petition. The ERC and the DOE filed their respective petitions for certiorari and prohibition before the SC. Thus, on October 10, the SC acted on the DOE’s petition.

Based on the rules, an end-user with an average monthly peak demand of at least 1MW is mandated to enter into a Retail Supply Contract (RSC) with a RES by its mandatory contestability date of December 26, 2016.

Subsequently, an end-user with an average monthly peak demand of at least 750 kilowatt (kW) is mandated to enter into an RSC with a RES by its mandatory contestability date of June 26, 2017.

The lowering of the threshold to cover an end-user with an average monthly peak demand of at least 500 kW is set on June 26, 2018, subject to the review of the performance of the retail market by the ERC.

In its review, the ERC shall establish a set of criteria as basis for the lowering of the contestability threshold.

Retail Aggregation shall subsequently be allowed on June 26, 2018. During this phase, suppliers of electricity shall be allowed to contract with end-users whose aggregate demand within a contiguous area is at least 750 kW.

Earlier, the ERC hailed the recent pronouncement by Meralco it would apply for the registration of an affiliated company as an RES, in accordance with the government’s retail competition and open access (RCOA) policy in the power sector.