DOE: 40 erring power firms face suspension

MANILA, Philippines — The government is cracking the whip on non-compliant power generation companies, with at least 40 gencos facing suspension for continuing to snub show-cause orders (SCOs).

“We’ve given them a warning, and we are now in the process of recommending suspension to ERC (Energy Regulatory Commission),” Energy Secretary Sharon Garin said in an interview over the weekend.

Garin did not name the companies but said most operate small diesel-fired power plants.

Some, she noted, are no longer even operational, effectively removing capacity from the grid as the country continues to grapple with tight power supply.

Several major generating units have simultaneously gone offline, putting the major grids, especially the Visayas, under strain.

The Department of Energy (DOE) has served SCOs to the erring gencos, requiring them to explain why they failed to submit mandatory self-assessment forms.

The power firms are also being asked to account for forced outages, reduced generation and their failure to deliver the capacities they had committed to provide to the grid.

“We’ll wait for the process. But we’ve been meeting since last week on what to do. So the decision is to send it to ERC for proper action,” Garin said.

The DOE last week issued a draft department circular proposing supplemental guidelines for the implementation of its genco accountability policy.

Under the proposed rules, a genco found to have committed a prima facie violation may be issued an SCO and placed under strict compliance monitoring.

For the first offense, the company will receive a stern warning and be required to comply with the DOE’s monitoring requirements.

Failure to submit required reports or documents within the prescribed period may constitute a second or third offense.

On the second offense, the case will be referred to the ERC for appropriate action.

The genco could face suspension of its DOE-issued certificate of endorsement.

The third offense would carry even heavier consequences, including the blacklisting from DOE-administered programs. Gencos could also be endorsed for the revocation of its compliance certificate or other authorizations issued by the ERC.

“It (circular) seeks to ensure the timely submission of complete, accurate and transparent reports, promote due process and regulatory consistency in enforcing reportorial obligations and support the DOE’s mandate to uphold the reliability, adequacy, security and resilience of the electric power industry,” the DOE said.