Osmeña calls for restructuring of ERB

Senate President Pro Tempore John Osmeña called yesterday for the restructuring of the Energy Regulatory Board (ERB) to make it attuned to the present deregulated environment of the oil industry.

Osmeña, also chairman of the Senate committee on energy, noted that the ERB was left virtually powerless after the enactment of the law deregulating the oil industry.

He proposed the restructuring of the ERB into the Energy Regulatory Authority which shall have an expanded role and jurisdiction.

Osmeña pointed out that at present, power generation is about 75-percent controlled by the government through the National Power Corp.; power transmission is controlled totally by the government, and distribution is in private hands.

"Under a deregulated regime, generation is not going to be regulated. Transmission will be a monopoly and will be regulated, and distribution will continue as is and will be regulated. That is the environment for which we are now reshaping the ERB into the Energy Regulatory Authority," he explained.

The proposed ERA will have the power to fix all electric power rates except those relating to generation, which will be determined by the market.

Osmeña added that the ERA will have the power to regulate other energy sources, in particular gas, geothermal and hydroelectric, "since regulation is not a proper function of the Department of Energy and to address the void created by the oil deregulation law."

When public necessity requires, ERA may regulate the business of importing, exporting, re-exporting, shipping, transporting, processing, refining, marketing and distributing of energy resources, subject to the provisions of the Downstream Oil Industry Deregulation Act of 1998.

Osmeña said that the proposed ERA will have a consumer arm to protect the interest of all electric consumers. He described the establishment of a consumer arm as a "novel approach that will ensure adequate representation and promotion of consumer interests."