Competitive selection process for power supply deals takes effect

MANILA, Philippines - The Energy Regulatory Commission (ERC) has reminded power players to comply with the competitive selection process (CSP) policy which takes effect today.

The ERC said distribution utilities (DUs) are now required to undertake competitive bidding to secure power supply agreements (PSAs) with generation companies.

This means at the start of business hours on May 2, the ERC will only docket PSAs that underwent competitive bidding.

“The distribution utilities and the generation companies are enjoined to comply with the requirement on the conduct of a competitive selection process before entering into a power supply agreement to promote transparency in the procurement of power and elicit the best price offers which would mean a lower pass-on charge to electricity consumers,” ERC chairman Jose Vicente B. Salazar said.

DUs cover private distribution companies and electric cooperatives.

Last month, the ERC moved the effectivity date of the CSP policy from Nov. 6, 2015 to April 30, 2016.

The decision to delay the CSP implementation date will allow power players a transition period.

The power regulator has received numerous requests and clarifications from industry players about the policy, ERC spokesperson Floresinda Digal said earlier.

After the November implementation of CSP, the ERC has received at least 15 letters of request for exemption from conducting biddings.

These requests came from Philippine Rural Electric Cooperative Association Inc., The Association of Mindanao Rural Electric Cooperatives Inc., Agusan del Norte Electric Cooperative Inc., SMC Global Power, Region 8 electric cooperatives, Camarines Sur IV Electric Cooperative Inc., NEgros Occidental Electric Cooperative, Abra Electric Coopetative Inc., Palawan Electric Cooperative and Office of the Sangguniang Panlalawigan of Puerto Princesa City.