RCOA to go full swing following SC decision

CEBU, Philippines - The retail electricity business can now fully take off after the Supreme Court released a temporary restraining order allowing the full implementation of the Retail Competition and Open Access (RCOA).

RCOA is a provision of the Electric Power Industry Reform Act (EPIRA) of 2001.

The Department of Energy and Energy Regulatory Commission welcomed the SC's decision.

ERC chairman Jose Vicente Salazar confirmed in a report Sunday the high court's issuance of a temporary restraining order, which enjoined the Pasig RTC from blocking the full iplementation of an open retail market.

A DOE statement quoted Energy Chief Alfonso Cusi as saying that the decision on RCOA is pivotal to the implementation of EPIRA as it gives electricity consumers the power of choice.

ERC is setting a shift to RCOA, which allows qualified consumers to source their electricity supply from competing retail electricity suppliers.

Open access also allows them to use existing transmission and distribution systems as well as associated facilities but subject to the payment of ERC-approved rates.

In Cebu, for instance, RCOA consumers are increasing, according earlier to Luis Miguel O. Aboitiz, chief operating officer for business group of Aboitiz Power Corp.

Aboitiz Power has a number of Cebu-based consumers in its retail energy business.

"We expect more [open access consumers in Cebu]," the COO earlier said in an interview.

Cusi said: “The DOE and the ERC are pushing reforms to implement the provisions that gives the consumers the power of choice. But some distribution utilities are preventing it.”

With RCOA, "constestable Customers” or those consuming 1 megawatt of electricity are now able to choose their power supplier/s to reduce their costs.

Previously, electricity customers were captured by the distribution utilities within their franchise area and were forced to pay the contracted supply of their respective distribution utilities.

“Currently, the DOE is undergoing the preparatory stage to include consumers consuming 750 kilowatts as contestable customers,” Cusi said.

Under DC2015-06-0010, electricity end-users with a monthly average peak demand of at least 1 MW for the preceding 12 months will be the Contestable Market upon initial implementation of the RCOA.

Two years afterwards, the threshold level for the Contestable Market will be reduced to 750 kilowatts (kW).

Subsequently, the ERC is required to evaluate the performance of the electricity market and gradually reduce the threshold level until it reaches household demand level.

Starting June 26, 2017, ERC also mandates those consuming at least 750 kilowatts to also buy electricity from ERC-certified suppliers as the regulator moves the retail power market towards greater competition as called for by Republic Act No. 9136 or the Electric Power Industry Reform Act (EPIRA).

For end-users with an average monthly prak of at least 750 kW and 1 MW for the preceding 12 months, the date for voluntary contracting of electricity is set on June 26, 2016.

This becomes mandatory on Dec. 26 for those consuming 1 MW, and on June 26, 2017 for those consuming at least  750 kW. (FREEMAN)