Rules on power supply bidding out next month

MANILA, Philippines - The Department of Energy (DOE) and the Energy Regulatory Commission (ERC) have committed to issue the rules for the competitive selection process (CSP) by Oct. 27 they gather more input from industry stakeholders.

DOE OIC-Secretary Zenaida Monsada said the technical working group has completed the draft implementing rules and regulations IRR for the CSP which is now up for public consultations.

With less than two months before the deadline, both the DOE and ERC are firm on meeting the Oct. 27 target to come out with the IRR.

In a text message to reporters, ERC chairman Jose Vicente Salazar said the intention to meet the deadline is to determine whether to go through CSP or not.

“Our intention is to have a decision by that time, so either we go on with the CSP or set that aside. We want to come up with a decision that is acceptable to all the parties and at the same time achieve the objective of the DOE circular,” he said.

Salazar said public consultations are planned in the “middle to the third week of October.”

The DOE and ERC are now seeking comments from industry stakeholders before Oct. 1 as both agencies posted the draft IRR in their respective websites.

DOE Electric Power Industry Management Bureau director Mylene Capongcol said among the salient points of the draft IRR include the CSP being mandatory and the requirement for a third party, the two main concerns of the private sector.

Manila Electric Co. (Meralco) earlier contested that the CSP should be on a voluntary basis.

On the other hand, former Energy Secretary and Trans-Asia Oil and Energy Development Corp. president Francisco Viray said the third party component will just add another layer to the already long bidding process.

However, Monsada is hopeful the draft guidelines will clarify all the issues raised by the industry.

The DOE issued on June 30 the circular mandating all distribution utilities to go through competitive bidding in securing power supply agreements (PSAs).

It aims to make the power purchase process transparent and to bring down prices in line with the objective of the Electric Power Industry Reform Act of 2001 (EPIRA).