Government to probe rotational brownouts in Luzon

MANILA, Philippines — The Philippine Competition Commission (PCC) is gathering more evidence as it investigates specific entities that could have a hand in causing rotating brownouts last month.

“Hopefully in the coming weeks, months, we’ll be able to get more information... I wish I can say more about the specific details...[but I] can’t say who are the parties specifically being investigated right now but that’s where we are now,” PCC chairman Arsenio Balisacan said in a webinar held over the weekend.

Balisacan aid the commission is working closely with the Energy Regulatory Commission (ERC) and the Department of Energy (DOE) for the investigation ordered by Malacañang.

“So far, with respect to the brownout case that was brought up to the commission by the office of the president... we are using the [memorandum of agreement] MOA with the ERC as a vehicle to get that information or sharing of information,” Balisacan said.

“We are also working closely with the DOE, and we have, in fact, a task force organized to get this coordination working as smooth as possible and achieve our objective of securing that information, documents, evidence to get the case moving,” he said.

He was referring to the three-way partnership inked by PCC with ERC and DOE in 2019 to strengthen cooperation, particularly in investigating anti-competition cases in the energy industry.

Ahead of the MOAs with the DOE and ERC, the three agencies formed a tripartite task force to coordinate probes on alleged collusions or abuses of dominance in the power industry through information exchange and fact-finding, given the policy mandate of the DOE, the regulatory functions of the ERC and the market competition lens of the PCC.

The DOE earlier sought the help of the PCC, ERC and the Department of Justice (DOJ) to build up cases against energy industry players that violated its rules on plant maintenance schedules and contracting of supply which led to rotating brownouts in the Luzon power grid last May 31 and June 1.

The DOE will submit information for the consumers and the enforcement agencies, considering its long-term strategy of addressing the power supply and demand situation during the summer season.

Based on a circular issued last year, only hydropower generators are allowed to conduct preventive maintenance in the second quarter annually. Generators are required to submit their planned outage schedules to the National Grid Corp. of the Philippines (NGCP), which will then submit the grid operating and maintenance program (GOMP) to the DOE.

The Luzon grid lost as much as 4,000 megawatts (MW) in supply, leading to a deficiency of 716 MW at one point, as some power plants extended their plant outage while some went on forced outage.

This led to the several instances of triggering the secondary price cap in the wholesale electricity spot market.

Due to the severe power conditions in the power grid in the past two months, consumer electricity bills have increased mainly due to higher WESM charges.