MANILA, Philippines — The speedy resolution of the leadership vacuum at the Energy Regulatory Commission (ERC) will serve the best interest of power players and consumers since the power industry is a heavily regulated one, according to the top official of Manila Electric Co. (Meralco).
Since the power sector is heavily regulated, the operations and services of power distributors to customers are largely affected by the ability of its regulator to function effectively, Meralco president Oscar Reyes said.
Without the regulatory functions of ERC, he said the power industry would be put at risk since it would not be able to ensure power supply and security moving forward.
“(Power supply and security) is critical at this point because the country is very well positioned in terms of its growth trajectory. The country has become highly attractive not only to local but also foreign investors. And we don’t want to lose that sort of momentum and confidence,” he said.
“There are many critical pending issues that relate to the operations, the investments, the building of new power plants, the supply of different distribution utilities (DUs) and electric cooperatives (ECs), so I think it is quite critical that ERC be restored to its regular functioning,” he said.
Last month, the Office of the Ombudsman ordered the suspension ERC commissioners Alfredo Non, Gloria Yap-Taruc, Josefina Patricia Magpale-Asirit and Geronimo Sta. Ana for one year without pay for delaying the conduct of competitive bidding in securing power supply agreements (PSAs).
The competitive selection process (CSP) policy—which requires DUs and ECs to undertake competitive bidding to secure PSAs with generation companies—was supposed to start in Nov. 7, 2015, but implementation was moved to April 30, 2016 to give power players a transition period to comply.
The Ombusdman said delay in implementation negated the policies contained under the Electric Power Industry Reform Act of 2001 (EPIRA) and CSP resolutions to protect the interests of consumers.
However, ERC chairperson and CEO Agnes Devanadera said the one-year suspension order on the four commissioners would paralyze the agency and the whole power industry with P1.59 billion worth of pending applications before the agency.
She also said this could lead to possible power outages in Metro Manila and in the provinces due to the long list of pending cases before the ERC.
This is because the ERC acts as a collegial body and the presence of at least three members of the commission is needed to constitute a quorum to adopt any ruling, order, resolution, decision or other acts of the Commission in the exercise of its quasi-judicial and quasi-legislative functions, Devanadera said.