ERC urges Meralco to reconsider RCOA opposition

MANILA, Philippines - Instead of blocking a major reform in the power industry, the Energy Regulatory Commission (ERC) urged Manila Electric Co. (Meralco) to back changes aimed to cater to the best interest of consumers.

The power regulator called on Meralco to extend its full support to the new implementation guidelines on Retail Competition and Open Access (RCOA) after the power distributor sought court relief to block the new rules.

ERC chairman Jose Vicente Salazar said the RCOA marks a major milestone in the country’s bid to make electricity rates more affordable to end-users, which puts “the power of choice of electricity supplier in the hands of the customers.”

“RCOA is designed to change the current situation where customers do not have the choice as to who will supply their power requirements and are dependent on utilities designated purely on the basis of geographical territory,” he said.

RCOA aims to empower end-users that are part of the contestable market, or contestable customers, by giving them the choice to choose their supplier of electricity aimed to foster competition in in the generation and supply sector.

“Through RCOA, more captive customers will be able to graduate into the so-called contestable market where all retail electricity suppliers compete,” Salazar said.

The ERC chair said he finds no strong reason “or Meralco to block a mechanism “which would be good for the retail customer base in its present service area.”

“I am confident that Meralco will see that the RCOA is good both for its customers and its business,” Salazar said.

Meralco, through ACCRA Law firm, filed a petition with Pasig Regional Trial Court - Branch 157 last May 27, asking the local court to declare the recent issuances of the Department of Energy (DOE) and Energy Regulatory Commission (ERC) on RCOA rules null and void.

Salazar said the direction of the power sector is “clearly towards higher levels of competition which would assure all types of customers the best and affordable rates.”

Earlier, the ERC moved the effectivity date of the Competitive Selection Process (CSP) policy, another reform in the power sector, from Nov.  6, 2015 to April 30, 2016.

The CSP requires all distribution utilities and electric cooperatives to conduct an open and competitive process in selecting the power generating company from whom they are to purchase their supply for the captive markets.

“We can no longer set back gains of the power sector – it can only move forward and the direction is clearly that of competition,” Salazar said.