ERC drafts Guidelines for SoLR for the Contestable Market
The
Energy Regulatory Commission (ERC) will be holding a public consultation on
January 20, 2006, 9:00 a.m. at the Hearing Room, 15/F Pacific Center Building,
San Miguel Avenue, Ortigas Center, Pasig City to discuss the draft Guidelines
for the Supplier of Last Resort (SoLR) for the Contestable Market. The Guidelines
provides a safety net for end-users in the contestable market in the event that
their current electricity supplier is unable to continue providing service.
Further, the Guidelines encourages contestable customers to choose their supplier
of electricity upon the implementation of retail competition and open access.
Customers who do not actively make a choice will automatically be served by
the SoLR, whose rates are higher than any competitive offer.
SoLR, as a regulated entity, has the obligation to serve end-users in the contestable
market in a non-discriminatory manner. The temporary service obligation of SoLR
as a back-up electricity supplier to the end-users in the contestable market
ends when they find a new RES.
A distribution utility shall perform the duties and obligations of a SoLR in its franchise area during the initial phase of retail competition and open access, until the ERC issues a decision allowing other entities to provide SoLR service on a competitive basis.
The RES as defined in the Guidelines, refers to any person or entity licensed by the ERC to sell, broker, market or aggregate electricity to end-users.
Contestable market refers to electricity end-users who have a choice of electricity supplier and with a monthly average peak demand of at least one megawatt (1MW) for the preceding twelve (12) months, at the time of the initial implementation of open access.
The approval of said Guidelines is in anticipation of the implementation of open access and retail competition which is expected to be in the middle of year 2006. Competition at the retail or supply level, where every consumer has the power to choose his source of electricity under a competitive market, is the ultimate objective of the Electric Power Industry Reform Act (EPIRA).
“We are gearing towards the last phase of the power reform agenda which is market competition. This public consultation will serve as another venue in determining the appropriate collective idea that best represents public interests on power reform,” ERC Chairman Rodolfo B. Albano, Jr. announced.
The EPIRA mandates the ERC to promote competition at the supply or retail level and encourage end-users in the contestable market to choose their supplier of electricity upon the commencement of retail competition and open access.
Copies of the draft Guidelines may be photocopied, at cost, during regular office hours at the ERC Ortigas Office or may be downloaded from the ERC website at www.erc.gov.ph. All interested parties may submit their written comments (soft copies may be sent to mdsantos@erc.gov.ph/contestable@erc.gov.ph, or hard copies can be sent to Director Edgar F. Samonte of the Market Operation Service at fax no. [02] 633-32-53) on or before January 13, 2006. Parties who have filed their written comments or manifested in writing their intent to participate in the said proceeding within the period prescribed above are considered parties of record and will be given priority during the scheduled consultations.
December 15, 2005