Lawmaker seeks ERC rule revisions

By Jordeene Sheex Lagare – March 27, 2018
from The Manila Times

A lawmaker wants to amend rules on using power generation companies’ (gencos) installed capacity to compute their market share limitations, which the Energy Regulatory Commission (ERC) sets annually.

In an interview, Sen. Sherwin Gatchalian said he wanted to know ERC’s reasoning to use installed capacity, instead of actual capacity.

“That’s a topic that we will raise with ERC. Moving forward, we have to look at the actual generation of the companies. Somehow it should play a role in determining the market share limitations,” he added.

According to the Senate energy committee chairman, hydropower and solar facilities are vulnerable to natural conditions, while coal plants produce electricity nonstop, whatever the weather.

Such conditions affect market share, he said.

As an example, Gatchalian said a solar plant’s installed capacity is 100 megawatts (MW), but actual capacity is only 10MW. In contrast, a coal plant’s installed and actual capacities are both 100MW.

The legislator’s statement echoed the call he made at the Executive Seminar on Fostering Dynamic Competition in the Philippine Power Industry last October.

 In his keynote speech, the senator said the rules needed to be reviewed, adding that it did not reflect a company’s true market power.

Earlier this month, ERC issued a resolution increasing the capacity limit and market share of gencos that took effect on March 15.

Under Resolution 4, Series of 2018, issued on February 27, the limit was increased to 5,466.78MW from 5,167.48MW.

The limit for Luzon is now 4,552.79MW; Visayas, 958.47MW; and Mindanao, 1,048.88MW.

The figures represent 30 percent of total installed capacity in the three power grids that rose to 21,867.12MW from 20,669.92MW.

Capacity for the Luzon grid is 15,175.97MW; Visayas, 3,194.89MW; and Mindanao, 3,496.26MW.