Friday, October 21, 2016

DOE Wins Thrust Towards Full Implementation of RCOA, Ensuring Consumer Choice in the Power Industry

Wazzup Pilipinas!

Energy Secretary Alfonso G. Cusi welcomed the Supreme Court (SC) issuance, which is pivotal to the implementation of the Electric Power Industry Reform Act (EPIRA) that gives the electricity consumers the power of choice.

On 10 October 2016, the Department of Energy (DOE) together with the Energy Regulatory Commission (ERC) scored a victory with the recent Temporary Restraining Order (TRO) issued by the SC in allowing the full implementation of the Retail Competition and Open Access (RCOA) provision of the EPIRA.

Secretary Cusi emphasized that “The DOE and the ERC are pushing reforms to implement the provisions that gives the consumers the power of choice. But some distribution utilities are preventing it.”

“The Supreme Court saw the need to uphold the role of the DOE - ERC in giving consumers the power of choice,” Cusi said.

“With RCOA in place, “Constestable Customers” or those consuming 1 megawatt (MW) of electricity are now able to choose their power supplier/s to reduce their costs.”

Cusi explained, “In the previous set up, electricity customers were captured by the distribution utilities within their franchise area and were forced to pay the contracted supply of their respective distribution utilities.”

“Currently, the DOE is undergoing the preparatory stage to include consumers consuming 750 kilowatts as Contestable Customers.”

The SC issued a TRO enjoining the Regional Trial Court, Branch 157, Pasig City, from continuing the proceedings in the Petition for Declaratory Relief filed by the Manila Electric Company (MERALCO) against the DOE and the Energy Regulatory Commission (ERC).

In the said Petition, MERALCO sought to nullify DOE Circular No. DC2015-06-0010 (released 19 June 2015) and related resolutions issued by the ERC, enjoining the DOE and ERC from implementing them. Under DC2015-06-0010, electricity end-users with a monthly average peak demand of at least 1 MW for the preceding 12 months will be the Contestable Market upon initial implementation of the RCOA. Two (2) years afterwards, the threshold level for the Contestable Market will be reduced to 750 kilowatts (kW). Subsequently, the ERC is required to evaluate the performance of the electricity market and gradually reduce the threshold level until it reaches household demand level.

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