A group of electricity consumers has asked the Supreme Court to dismiss the petition against the retail competition and open access in the power industry.
In a motion for intervention, the National Association of Electricity Consumers for Reforms through its Executive Director Rafael Antonio Acebedo appealed to the high court, saying that “any decision or resolution to the contrary will definitely prove harmful to the welfare and interest of the electricity consuming public.”
Nasecore filed the motion in an effort to reverse the Court’s ruling against the RCOA, a landmark policy meant to give consumers the choice to choose their own electricity supplier.
The SC earlier temporarily stopped the implementation of RCOA, which was supposed to take effect on Feb. 26, based on a petition filed by the Philippine Chamber of Commerce and Industry, Ateneo de Manila University, San Beda College (Alabang) and mall owner Riverbanks Development Corp.
The group in its submitted comment to the SC asked the tribunal to dismiss the petition for lack of merit and prejudicial to the interest of electricity consuming public.
“One of the pillars of the restructuring of the energy industry, as envisioned by the Epira [the Electric Power Industry Reform Act of 2001], is the establishment of retail competition and open access. The framers of the Epira believed that the migration of electricity consumers to the competitive retail electricity market would lead to market competition thereby leading to lower and reasonable electricity prices,” Nasecore stressed.
“Nasecore is intervening in the present case based on the ground that the issues raised herein are matters of transcendental importance, public service, policy and interest, and that its electricity consumers-members will be directly, actually and greatly affected by the annulment of the Department of Energy [DoE] and Energy Regulatory Commission’s [ERC’s] assailed issuances in this petition,” the group said.
Nasecore said it “vehemently disagrees” with the petitioners who wished to stop RCOA, which is covered by DoE Circular No. DC-2015-06-0010, series of 2015; ERC Resolution No. 5, Series of 2016; ERC Resolution No. 10, Series of 2016; ERC Resolution No. 11, Series of 2016; and ERC Resolution No. 28, Series of 2016.
“The assailed issuances are valid and reasonable regulatory measures geared toward the promotion of the avowed purposes of the Epira, among others, promote true market competition and prevent harmful monopoly and market power abuse in the electric power industry,” Nasecore argued.
The group pointed out that without RCOA “certain industry players will be able to monopolize and abuse the electricity market.”
Nasecore noted that prior to the assailed issuances, Manila Electric Co. contracted with contestable customers through its affiliate local retail electricity supplier, MPower. “As of August 2016, a total of 1,368 consumers in Luzon and 176 in the Visayas belonged to the contestable market. Further, as of 18 June 2016, MPower was already able to capture about 50 percent of the market share of the contestable market within its franchise, or 18 percent of the total nationwide.”
“It is clear that Meralco was able to take advantage of its position as the exclusive distribution utility over its franchise area with unparalleled access to the contestable customers,” Nasecore said. “Where is the true market competition in a situation wherein 50 percent of the market share belongs to one entity? There is none. A harmful monopoly clearly exists.”
During the first quarter of 2016, Nasecore noted that Meralco had entered into 20-year power supply agreements with generating companies owned by Meralco’s owner, the Pacific Group. These contracts would cover 90 percent of Meralco’s power requirements. “In this regard, the Alyansa Para sa Bagong Pilipinas, Inc. claimed that the said deals or contracts would burden consumers with overpriced power costs of P12.44 billion a year.”
According to Nasecore, it is holding on to Epira’s promise to promote true market competition and prevent harmful monopoly and market power abuse in the electric power industry. It hopes that this promise will bring the cost of electricity down not just for the large electricity consumers but also for the end-users at the household level.
