QuestionsQuestions (ERC Resolution NO. 16, S. 2012)
The purpose is to ensure a smooth transition from the existing electric power structure to a competitive environment and to promote the interests of all electricity industry stakeholders through the establishment of open access at the distribution level.
The rules apply to Central Registration Body (CRB), Contestable Customers, Retail Electricity Suppliers (RES), Local RES, Distribution Utilities (DUs) including those serving economic zones, Supplier of Last Resort (SOLR), National Grid Corporation of the Philippines (NGCP), Metering Service Providers (MSP), and all other relevant industry participants.
A Contestable Customer is an electricity end-user who has the choice of a supplier of electricity as determined by the Energy Regulatory Commission (ERC) in accordance with the Act and Rules for Contestability.
The CRB is an independent entity tasked with developing and managing systems and IT infrastructure for customer switching, information exchange among market participants, and settlement of transactions in the Wholesale Electricity Spot Market (WESM). The CRB functions are performed by the Philippine Electricity Market Corporation (PEMC).
During the Transition Period, Distribution Utilities (DUs) continue to supply electricity to Contestable Customers at rates equivalent to those charged to captive customers to ensure supply continuity as the competitive retail market is established.
The Cooling-Off Period is a five-business day (or longer if agreed) period commencing from the signing of the Retail Supply Contract (RSC), during which the Contestable Customer has the right to cancel the contract with the Retail Electricity Supplier without penalty.
If a Contestable Customer fails to contract with a RES by June 26, 2013, the DU shall continue to serve them until December 25, 2013, provided the Contestable Customer shows it has exhausted all means to secure an RSC. Otherwise, the DU may disconnect the customer or transfer service to the Supplier of Last Resort (SOLR).
The initial SOLR Rate is the higher of the WESM Ex-Ante Nodal Energy Price or the bilateral contract price plus a 10% premium to cover incremental administrative costs and return on investment, effective from June 26, 2013 until approved otherwise by the ERC.
The Energy Regulatory Commission shall impose appropriate fines and penalties pursuant to the Guidelines to Govern the Imposition of Administrative Sanctions in the form of fines and penalties under Section 46 of Republic Act No. 9136 for any violations or non-compliance.
Distribution Utilities are responsible for procuring energy related to distribution system losses and may recover these costs through ERC-approved system loss charges subject to a system loss cap. RES/Local RES/SOLR must pay the DU applicable system loss charges for energies delivered to their customers.