ERC drafts new rules for wholesale power sellers

The Energy Regulatory Commission (ERC) has drafted new rules for the registration of wholesale power aggregators.

ERC chairman Rodolfo Albano Jr. said the rules are consistent with the Electric Power Industry Reform Act, its implementing rules and regulations (IRR), the Philippine Grid and Distribution Code and the wholesale electricity spot market (WESM) rules.

Albano said the rules will provide for the qualifications and obligations of a wholesale aggregator and the requirements and procedures for their registration with the ERC.

"The rules aim to promote free and fair competition and accountability of electric power industry participants. Also, the rules aim to provide supply options for distribution utilities (DUs) specifically small electric cooperatives," Albano said.

Although wholesale aggregation only starts two years after the initial implementation of retail competition and open access, the ERC is making sure all the necessary structures are available when wholesale aggregation occurs.

"The ERC will issue a Certificate of Registration to qualified wholesale aggregators for them to become a member of the WESM. No wholesale aggregator can enter into a contract for the sale of electricity to a DU without having registered with the ERC,"Albano said.

He said only those who have filed their written comments on or before the prescribed period shall be considered parties of record. "Thus, the concerned parties are encouraged to proactively participate towards attaining our common goals."

The ERC issued recently the amended guidelines on the issuance of licenses to retail electricity suppliers (RES). An RES is a person or entity authorized by the ERC to sell, broker, market or aggregate electricity to the end-users in a contestable market to be determined by the ERC. In a contestable market, consumers have the power to choose their electricity supplier.

The guidelines were amended to include, as an additional qualification, the ability of a RES to set-up and operate (within the ‘customer-transfer system’ approved by the ERC) an automated information exchange associated with business to business (B2B) communications and transactions.

The guidelines aims to promote free and fair competition, and accountability among electric power industry participants to achieve greater operational and economic efficiency, thus, rationalize electricity prices and make them competitive and transparent.

It is also the goal of the guidelines to ensure consumer protection and enhance the competitive operation of the retail electricity market.

The issuance of separate guidelines for aggregators would be part of the second phase of retail competition and open access. DUs within their franchise areas and persons authorized by appropriate entities to supply electricity within their respective economic zones are exempted from securing a supplier’s license.