Commercial operations of Retail Competition and Open Access launched

June 26, 2013 10:15 pm 

MANILA, June 26 — The Department of Energy (DOE) and the Energy Regulatory Commission (ERC) together with the Philippine Electricity Market Corporation (PEMC), administrator of the Wholesale Electricity Spot Market (WESM), launched the commercial operations and integration of the Retail Competition and Open Access (RCOA) into the Wholesale Electricity Spot Market (WESM) on 26 June 2013. PEMC is the Central Registration Body (CRB) of the RCOA.

“The RCOA is a journey representing the harmony of working relationships hard work and dedication with its own set of challenges along the way. The evidence of that commitment is today as we officially launch the Commercial Operations of the Open Access,” said DOE – Electric Power Industry Management Bureau Director III Irma C. Exconde.

ERC Commissioner Alfredo J. Non, who oversees the regulatory aspect of the RCOA had this to share, “We are finally here, with the effort of DOE, PEMC and ERC, we are now launching RCOA. Like any activity, there is always a learning curve. The RCOA is new to all of us. And even the other countries that have implemented it, did not escape this initial adjustment process.”

“It is very timely and appropriate that we declared today, 26 June 2013, as the end of the RCOA Trial Operations Program which commenced on 26 March 2013 and the beginning of its Commercial Operations as this coincides with the 7th Anniversary of the WESM. Today, we are celebrating two landmark events in the history of the Philippine electric power industry: the anniversary of the Wholesale as well as the launch of the Retail electricity market,” said PEMC President Melinda L. Ocampo.

Considered to be a major milestone in the Philippine electric power industry, the RCOA will allow any qualified contestable customer the use of transmission, and/or distribution system and associated facilities subject to the payment of transmission and/or distribution retail wheeling rates as approved by the ERC. This means that aside from the Distribution Utilities (DUs), customers may now have the choice of procuring their power supply from Retail Electricity Suppliers (RES) other than the DU which has been their perpetual supplier. For the initial implementation of RCOA, the qualified customers are those with an average of 1 megawatt electricity consumption over the course of a year.

The first registered Contestable Customer (CC) in the WESM is the San Miguel Brewery Inc. under the San Miguel Electric Corporation.

SMBI President Mr. Roberto N. Huang expressed his optimism at the RCOA launch, “We cannot help but be optimistic about the impact of Open Access in the long run as it promotes competition among retail electricity suppliers, Open Access provides another compelling reason why investors should put up businesses here in the country since the policy could help lower the cost of power. With more competition in the field, the level of service would surely improve as players would want to get as many customers as it could.”

Elaborating on the RCOA’s catchphrase “the power of choice”, Mr. Huang further said, “For us at San Miguel Brewery, being a Contestable Customer, it allows us to assess our power consumption and match it with the supplier that can meet our requirement, of course, at the right price to be able to manufacture our world class beer with the consistent supply of electricity to power our machines. From a macro perspective, Open Access empowers businesses as the latter would be able to decide for themselves which provider is in the best position to supply its needs.”

To date, PEMC, which is the Central Registration Body (CRB) of the RCOA has registered 239 contestable customers with their respective suppliers: Aboitiz Energy Solutions, Advent Energy Inc., TeaM (Philippines) Energy Corporation, DirectPower Services, Inc., Masinloc Power Partners Company Limited, San Miguel Electric Corporation and Manila Electric Company RES.

“Indeed, Open Access should be a compelling reason for multinational companies to be encouraged to set up manufacturing facilities here in the Philippines. So we encourage our colleagues in the private sector to join our ranks as a Contestable Customer,” said Huang, SMBI president.

“In the following months, the DOE, ERC and PEMC will be on the alert for any new issues that may arise as well as any deviations including necessary corrective actions as have been said earlier. It will take some time for the market to adjust and for the expected benefits to materialize. We have to accept that. As we move forward, we have to closely monitor and spend a little more time on RCOA. The DOE to provide the corrective policy directions, the ERC to provide the necessary regulatory support or intervention as the case may be and for PEMC to ensure operational efficiency,” said Commissioner Non.

To the participants of the WESM and RCOA, Ocampo said, “Rest assured that we would always be here to guide you and provide you with our assistance.” (PNA)

DSP/JS/PR/UTB

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