ERC unveils agenda to make it Asia’s benchmark in power regulation

The Energy Regulatory Commission (ERC) has unveiled a 10-point regulatory agenda which will allow it to become Asia’s benchmark for excellence in power regulation.

ERC chairman Rodolfo Albano Jr. said a major thrust in the regulatory agenda is the implementation of the performance-based rate-making (PBR) method for setting wheeling rates for the transmission and distribution sectors.

Albano said they are also committed to complete all the remaining first level regulatory commitments such as the processing of all transition supply contracts (TSCs), approval of sub-transmission sales and the balance of unbundling, cross subsidy removals, debt condonation, power purchase agreement verification cases and resolution of pending cases from 2001 to 2005.

Under the new agenda, ERC will also establish a regulatory framework that will ensure a stable wholesale electricity market.

The monitoring and enforcement system of the ERC will also be strengthened by redesigning the reportorial requirements for the distribution utilities (DUs), automating compliance monitoring to all orders, and developing an on-site audit system as well as compliance reminders system.

Another part of the agenda is putting an effective framework to promote retail competition.

As such, Albano said the ERC will promulgate the rules on uniform business practices, code of conduct, supplier of last resort and open access distribution services.

The ERC is also set to rationalize economic regulation for the distribution sector wherein the commission will standardize customer segments, cost allocation methods, and depreciation schedules per asset category.

Albano said they would also aim for the rationalization of technical regulation by promulgating the rules for capital expenditures project approvals, updating the Philippine Distribution Code (PDC), approving the distribution utilities‚ PDC compliance plans and the new segregated system loss caps, strengthening the distribution management committee and the grid management committee.

He said the commission is also setting its sight on establishing the product standards for kilowatthour meters in coordination with the Department of Trade and Industry-Bureau of Product Standards, the guidelines for ancillary service procurement, and guidelines to set caps for allowable transmission losses.

Another program in the regulatory agenda is the establishment of a regulatory environment that will promote efficiency in off-grid areas.

The ERC chief said there is also a need to strengthen the customer service capabilities of distribution utilities by prescribing the uniform operations manual for the consumer welfare desks requiring mandatory training programs for all frontline employees of the DUs at accredited training institutions, and institutionalizing audit programs to be undertaken by local consumer groups and local government units.

The ERC, he said, will also implement a targeted information and education program by undertaking regional symposia for targeted sectors, institutionalizing ERC’s partnership with the academe, regular updating of the annotated compendium of guidelines and the continuous improvement of the ERC website.