One-third of ‘contestable’ power consumers still unregistered — PEMC

By Victor V. Saulon – November 3, 2019 | 11:06 pm
from Business World

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UP TO 32% of electricity users that have been certified as “contestable” and can directly buy power from retail suppliers have yet to register in the retail electricity market, the Philippine Electricity Market Corp. (PEMC) said.

As of June, the report said a total of 1,306 electricity users were registered as contestable customers, or those whose average consumption in the past year reached at least 750 kilowatts (kW).

“The total registrants constitute about 68% of the 1,907 electricity end-users with ERC (Energy Regulatory Commission) Certificate of Contestability. The remaining 32% of electricity end-users have yet to register in the market,” it added.

The number of unregistered customers means retail electricity suppliers (RES) still have room to expand their businesses, which have been limited to the 750-kW-and-above power users after the Supreme Court in February 2017 ordered a halt to the implementation of rules covering retail competition and open access (RCOA). The high court has yet to lift the temporary restraining order it issued.

The second quarter’s number of registered contestable customers marked a 5% increase from the previous quarter’s 1,240 registrants, and a significant 23% increase from the 1,064 registrants in the same period last year.

Majority or 1,177 registered contestable customers were in Luzon and the remaining 129 were in the Visayas. Retail electricity supply is enforced where the electricity spot market operates, thus Mindanao has remained excluded under the rules covering RCOA.

Of the total registrants, 20% were in the 750 kW to 999 kW contestability threshold, while 80% were in the 1 megawatt (MW) and above threshold.

The contestable customers were engaged mostly in commercial activities at 629 registrants, and industrial activities at 629 registrants.

The PEMC report said the total energy consumption of the contestable customers for the second quarter of 2019 stood at around 4,960 gigawatt-hours. The consumption level accounts for about 22% of the combined energy consumption of the registered contestable customers and the “captive” customers for the quarter.

Captive customers are served by the retail electricity supplier owned by the company that holds the power distribution franchise in a given area.

“The load factor of registered Contestable Customers was maintained relatively high ranging from 77 to 88% throughout the period in review, indicating that their electricity usage was reasonably efficient. By the end of the June 2019 billing month, the load factor stood at 80.50% coming from 81.43% in March 2019,” the report said.

Rules governing RCOA are meant to give power users whose consumption has reached a pre-set threshold the “power of choice” to buy electricity from retail electricity suppliers licensed by the Energy Regulatory Commission.

That power was questioned as the rules made mandatory the switch from being a captive customer of a distribution utility to one that can choose to forge a power supply contract with a licensed RES.