Retail power competition and open access for 500 kW threshold begins

Some 800 power consumers with an average monthly consumption of 500 kilowatt-hours can start switching and choose their own suppliers with the effectivity of the lower threshold level for retail competition and open access on Feb. 26.

Jonathan de la Viña, marketing corporate strategy head of Independent Electricity Market Operator of the Philippines, said 13 contestable customers already registered with the agency, which serves as the central registration body of the retail electricity market.

“In 2018, 750 kW has opened and currently there is 384, and for 500 kW which is the nearest threshold, 13 contestable customers have successfully switched to a retail electricity supplier starting Feb. 26”, de la Vina said in a briefing Friday.

He said IEMOP started processing the 500 kW customer switching requests in January. He said with the approval, the would be supplied by the retail electricity supplier of their choice for the March billing period.

Under an Energy Regulatory Commission resolution, the threshold for participating in the retail electricity market was reduced from 700 kw to 500 kw, “so that means we have more eligible end users that could select their suppliers that is available in the market.”

The threshold is the minimum average peak demand for the past 12 months the consumer should have an average monthly peak demand of 500 kw for the past year.

IEMOP has 1,154 one-megawatt customers which started to switch in 2013.

De la Vina said there were 36 available retail electricity suppliers in the market and 14 local retail electricity suppliers.

“In terms of benefits of participating in the retail competition, the contestable customers are now provided options in their source of supply,” the IEMOP official said.

He said contestable customers could also negotiate with their suppliers. Distribution utilities have a pass-on provision that whatever cost they have for sourcing supply from the WESM or from their contracts, they just pass it on to the captive customers and the captive customers will have to pay that amount.

“In the retail electricity market, contestable customers can negotiate with their suppliers and eventually the goal, the end users are able to get the best deal for their electricity supply in terms of cost,” he said.

De la Vina said IEMOP was preparing for the further lowering of the threshold level to 100 kw and the introduction of retail aggregation, where two or more end users within a contiguous area can purchase as a single purchasing unit in the retail market.

Topics: Independent Electricity Market Operator of the Philippines , IEMOP , retail electricity market
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