The Energy Regulatory Commission (ERC) is warning private distribution utilities (DUs) and electric cooperatives (ECs) of prospective sanctions or penalties if they will block customers on their wish to switch service provider via the Retail Competition and Open Access (RCOA) policy.

In the REBOOT Philippines forum over the weekend that was hosted by the British Embassy in Manila, ERC Market Operations Director Sharon O. Montaner indicated that the regulatory body already issued warning to at least two electric cooperatives for reported non-cooperation on their part to facilitate the intended switch of their customers into the retail power market.

“We have two letter-warnings to them (ECs). If they won’t still comply, then we will issue SCO (show cause order) next,” she said.

The SCO will require the concerned ECs to explain or justify to the ERC, which is a quasi-judicial regulatory body, why they should not be pinned down for violations on impeding switching on supply sourcing that their customers opt to exercise.

As previously indicated by ERC Chairperson Agnes T. Devanadera, “the Commission has been regularly monitoring the activities in the competitive retail electricity market to observe the behavior of the stakeholders in this market, particularly in terms of pricing, switching patterns and the capacity and energy of contestable customers.”

The contestable market, which is being served by at least 42 retail electricity suppliers (RES), has been classified by the ERC as a briskly growing market in the restructured power sector.

“From the total number of 1,460 contestable customers which have entered into RSCs (retail supply contracts), 1,120 or 77-percent are within the 1.0-megawatt and above threshold; while 340 or 23-percent are within the 750kW to 999kW threshold,” the regulatory body stated.

Montaner qualified that customer switching rules are just applicable to the RCOA policy at this point; and it’s not being enforced yet for the Green Energy Option Program (GEOP) which is a parallel policy giving option to consumers at exercising freedom of choice in sourcing their energy supply or service from RE providers.

In the RCOA domain, the contestable customers who can already choose and underwrite a contract directly with their preferred suppliers are those in the usage threshold of 750 kilowatts and up.

Often, these are big-ticket customers such as industries, commercial end-users or buildings. And in contracting for their electricity service, they can also secure capacity at a price that will fit their budgets.

In the GEOP, once fully enforced, the threshold could be as low as 100 kilowatts, hence, this is deemed as an expanded version of the RCOA and may already reach the level of residential end-users.