The Energy Regulatory Commission had recommended to President Ferdinand R. Marcos Jr., to conduct a rationalization of the secondary price caps, the strengthening of local government units (LGUs) to facilitate energy project implementation, and the connection of small power utility groups to the grid.

No less than ERC Chairperson & CEO, Atty. Monalisa Dimalanta, made the recommendation during a recent meeting that was called for by President Marcos, Jr., with the Private Sector Advisory Council (PSAC).

During the meeting, PSAC presented its recommendations for the country’s infrastructure development with key focus on water, transport and mobility, logistics, energy and Public-Private Partnership (PPP) sectors.

President Marcos said that the government is already carrying out most of private sector’s infrastructure development recommendations of the Advisory body in continuous support to private sector partners.

For its part, the ERC reported that it is already conducting a review of the secondary price (SPC) which was first implemented around a decade ago primarily to protect consumers from unwarranted increase in electricity prices due to the inherent volatile market price movements in the Wholesale Electricity Spot Market (WESM).

They said that as per Republic Act No. 9136, generation prices are intended to be market-driven, that is, prices are dictated by market forces.

However, ERC said that initial analysis shows that, with SPC in place, price signals are distorted and actual market results do not necessarily reflect the true cost of generation.

This, according to the ERC, blurs planning exercises on energy security and dampens investors’ interest to in the Philippine power generation sector.

“The ERC needs to do a balancing act, as is the role of the regulator in our system. We need to ensure that the regulatory framework incentivizes investors to pour in more capital by building additional power plants to bolster the country’s supply requirements. At the same time, we cannot discount the fact that the price cap is a preventive measure to protect the consumers from the immediate impact of high market prices,” Dimalanta was quoted as sayng.

In the area of strengthening of local government units (LGUs) to facilitate energy project implementation, the ERC engages in collaborative efforts to ensure that energy projects are put in place in a timely manner to address the increasing demand for electricity.

It is part of the energy sector’s Energy Virtual One-Stop Shop (EVOSS) system, spearheaded by the Department of Energy (DOE), that provides a single decision-making portal to streamline the permitting processes or approval of energy projects with respect for new power generation, transmission, or distribution projects.

ERC is also partnering with LGUs to promote the net metering program and streamline processes for rooftop solar installations.

Dimalanta also added that, last year, the ERC approved the application made by National Grid Corporation of the Philippines (NGCP) for the interconnection of Mindoro to the grid.  Still in the pipeline are NGCP applications for approval of interconnection to the grid of Catanduanes, Marinduque and Palawan.

Catherine R. Cueto