ERC files new motion seeking to lift High Court TRO on RCOA

By Myrna M. Velasco – August 25, 2017, 10:00 PM

from Manila Bulletin

The Energy Regulatory Commission (ERC) has recently filed a motion with the Supreme Court seeking the lifting of its temporary restraining order (TRO) against the enforced rules of the Retail Competition and Open Access (RCOA) policy.

In an omnibus motion, the ERC has reiterated its prayer to lift the RCOA TRO issued on February 17 this year; and has also sought clarification on the scope of the high court’s order.

In that plea, the regulatory body primarily asked guidance on possibly allowing a lower threshold of 750 kilowatts (kW) for contestable customers that could be covered by retail competition; and for the ERC to be given so-signal to renew as well as issue new retail electricity supplier (RES) licenses to qualified industry players.

“They (SC) were the ones who issued the TRO – it’s impacting on the industry. Our hands our tied, so we have to seek guidance from them on how we can move forward,” ERC Officer-in-Charge Alfredo J. Non said.

The regulatory body indicated that it cannot say for now if the lowering of threshold to 750kW shall be done on ‘voluntary basis’ or mandatory, because that shall depend largely on the final prescription of the high court.

At present, contestability or the phase of retail competition is at 1.0-megawatt level  and still done on ‘voluntary basis’ following the SC’s restraining order.

Another hurdle for the industry, arising from the legal skirmish, had been the non-renewal of RES licenses because the ERC is not exactly certain how it shall sort out this dilemma after the ruling of the high court.

There have been several RES licenses that already expired and some are due to lapse, but they cannot secure regulatory approvals on renewal. Because of this, they raised fear of default on contracts with their customers.

Previous RES rules also allowed lower threshold of 750kW, but because of prescribed mandatory enforcement of contestability then, it was questioned by affected groups before the SC and that triggered the TRO issuance.

With dilemmas being encountered by the industry now, remedial measures are also being advanced by the Department of Energy (DoE) – a separate step from ERC’s filing.

On DoE’s take, it wants voluntary enforcement of retail competition at a threshold that could be down to as low as 500 kilowatts (kW) and will also be opening the participation of the local retail electricity supplier (L-RES) units of the distribution utilities (DUs) into the competitive arena of the restructured electricity sector.

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