The Energy Regulatory Commission (ERC) has been unable to process pending applications for new retail electricity supplier (RES) licenses, as well as applications for renewal, since a temporary restraining order (TRO) on the retail competition and open access (RCOA) system took effect.
“The issuance of the said TRO has put on hold operational matters of the RCOA, such as the issuance of licenses in favor of RES and the lowering of the threshold for contestability. These are integral to the mandate of the ERC in promoting competition, and ensuring customer choice pursuant to the provisions of the Epira,” the ERC said.
RCOA, in a nutshell, allows consumers to source power from a licensed RES to encourage competition in the generation and supply sector.
The Supreme Court (SC) issued on February 21 a TRO against a Department of Energy (DOE) circular and ERC resolutions days before these were supposed to take effect.
The mandatory switching of consumers with an average peak consumption of 750 kilowatts (kW) to 999 kW, which should have taken effect on June 26 was among the rules that were halted by the SC.
But the mandatory switching of power users consuming an average of at least 1 megawatt (MW) per month is already in effect. Its implementation took effect on December 26, 2016, more than a month prior to the issuance of the TRO.
“This situation effectively bars the entry of new players in the electric-power industry. To date, there are 14 license applications, seven of which are new applications, while the other seven are applications for renewal,” the ERC cited.
The seven new applications are from Solar Philippines Retail Electricity Inc., Green Energy Supply Solutions Inc., Green Core Geothermal Inc., Megawattsolutions Inc., Trademaster Symbior Rooftop Inc., Energy Trading Management Corp. and Asia Pacific Energy Corp.
The applications for renewal were sought by Direct Services Inc., Ecozone Power Management Inc., GNPower Ltd. Co., PRISM Energy Inc., AdventEnergy Inc., Aboitiz Energy Solutions Inc. and Phinma Energy Corp.
The ERC said out of the seven applications for renewal license, five have already expired. The licenses of Aboitiz and Phinma, meanwhile, will expire on October 28 and November 18, respectively.
The regulator said it has received inquiries and letters of concern from the RES regarding the renewal of their licenses and the effect of the non-renewal of the same.
These RES contended that the nonissuance of a RES license would greatly affect their operations and, likewise, put the contestable customers (CCs) who they have effective contracts at a disadvantage.
Based on ERC data, a total number of 144 CCs, with total demand of 267.16 MW, stand to be affected and may be prejudiced by the non-renewal of said licenses.
“In the absence of any safety nets available for these customers, in all probability, they could be subject to the imposition of the much higher supplier of last resort rate,” the ERC noted.
ERC said it is willing to comply with the TRO. However, the uncertainty and unrest in the electric industry caused by the wholesale non-implementation of the assailed issuances compelled it to seek refuge from the SC.
Thus, ERC filed an omnibus motion to reiterate an earlier prayer to lift the TRO and to clarify the scope of the TRO. To date, the said motion is still pending for resolution before the SC.