Among the significant mandates under the EPIRA is a
system of open access to transmission and distribution wires whereby the
National Transmission Corporation (Transco), its concessionaire, the NGCP, and
any distribution utility may not refuse the use of their wires by qualified
persons, subject to the payment of transmission and distribution retail
wheeling charges. The following are the conditions for the commencement of the
RCOA:
• Establishment of the Wholesale Electricity Spot Market (WESM);
• Approval of unbundled transmission and distribution
wheeling charges;
• Initial implementation of the cross subsidy removal
scheme;
• Privatization of at least 70% of the total capacity of
generating assets of NPC in Luzon and Visayas;
• Transfer of the management and control of at least 70%
of the total energy output of power plants under contract with NPC to the
Independent Power Producer Administrators (IPPA).
RCOA, in a nutshell,
allows consumers to source power from a licensed retail electricity supplier
(RES) to encourage competition in the generation and supply sector. RES are the
entities licensed by the ERC to supply electricity to end-users in contestable
market. At present, the majority of power consumers are being supplied by
Manila Electric Co. (Meralco), the country’s largest distribution utility (DU)
firm.
The mandatory switching of power users consuming an average of at least 1
megawatt (MW) per month is already in effect. The mandatory switching of
consumers with an average peak consumption of 750 kilowatts to 999 kW was
among the rules that were halted by the Supreme Court (SC). Participation in the retail
market shall require a retail supply contract (RSC) between a contestable
customer and RES, and registration of the RSC in the WESM.
Notes: MER said before, this mandatory switching may hurt their revenue but won't affect much to their net income since they still use MER's infra.
Notes: I heard the retail power rate of the Philippines is one of the highest in the region. Yes, it's really expensive. All the charges in the bill is expensive and the threshold for progressive electric consumer tax is quite small. Privatization and Lowering the Rate is quite conflicting concept to me. "Competition" can really lower the rate? or there would be real competition?