Senator Sherwin Gatchalian on Wednesday called for an inquiry into the competitive landscape of the power industry as part of efforts to ensure a reliable electricity supply and bring down costs.
“Despite the mandate of the Electric Power Industry Reform Act of 2001 [EPIRA] and the Philippine Competition Act (PCA) to promote competition among industries, the power sector remains essentially controlled by major business groups and the cost of electricity in the country remains high,” Gatchalian said in a statement as he filed Senate Resolution 1353.
“If only a few control the industry, how can we ensure the cheapest electricity?” he said.
The vice chairperson of the Senate Energy Committee said the current market share distribution and cross-ownership between generation companies, retail electricity suppliers and distribution utilities could undermine consumer welfare as economic concentration is likely to stifle competition or manipulate the disciplines of free markets.
He said the Philippines has the second highest residential rate among member economies in the Association of Southeast Asian Nations at P11.32 per kilowatt-hour, or 40.4 percent higher than the ASEAN average of P6.75 per kWh.
Energy Regulatory Commission chairperson Monalisa Dimalanta said the agency shares the concerns of Gatchalian over the high market concentration in the generation and supply sectors of the power industry.
“We have disclosed this observation when we issued in March this year our preliminary report on market share limitation as of end-2024. So far, there is no breach of the EPIRA-mandated grid and sub-grid thresholds on ownership, but we have flagged the high concentration of ownership among just 3 to 4 groups,” Dimalanta said.
“While the commission does not have authority to disapprove acquisitions or mergers in the power industry, we are prepared to exercise our authority to impose penalties on breach of market share limitations, bilateral contracting limits or any anti-competitive behavior or arrangement resulting from such acquisition/investment or mergers,” she said.