Senator seeks lifting of IPO requirements on power companies to lure more market players

Published June 8, 2021, 10:59 AM

by Hannah Torregoza 

Senator Sherwin Gatchalian is seeking passage of a measure that would open up the country’s electricity market by lifting the public offering requirement provision in the Electric Power Industry Reform Act or EPIRA Law to lure more generation companies into investing in the Philippines.

Gatchalian said he believes the country’s electricity supply would be more stable if more generation companies (Gencos) are allowed to participate in the power industry.

“In order to promote competition and encourage market development, we have to relax some policies such as the public listing which proved to be burdensome to generation companies especially to small renewable energy (RE) gencos that have difficulty in complying,” Gatchalian said in a statement.

“Kung mas marami ang mga kumpanya na makakapagbigay ng suplay ng kuryente, mas maigi ito dahil nakasisiguro tayo ng tuloy-tuloy na serbisyo at mas marami tayong mapagkukunan ng suplay ng enerhiya (If more companies can provide electricity supply, this would be better as we can be assured of continuous service and more sources of power supply),” the chairman of the Senate Committee on Energy further said.

In filing Senate Bill No. 2217, Gatchalian sought amendments to Section 43(T) of Republic Act No. 9136, or the EPIRA Act, saying this no longer serves its purpose.

“The initial purpose of the public offering requirement for generation companies in the EPIRA has been rendered irrelevant given all the developments in the electric power sector,” Gatchalian said in the explanatory note of his bill.

“If we were to encourage more investments in generation to meet our demand needs in the next 20 years, it is crucial to eliminate this additional barrier to entry,” he said.

In removing this additional requirement or barrier to entry, the lawmaker is hopeful it would attract more investments in the generation sector as the next 20 years will require an additional capacity of 71,817 megawatt (MW) installed capacity by 2040.

The senator said 9,508 megawatts (MW) or 13.24 percent of the additional total installed capacity would come from renewable energy capacity to meet the one percent renewable portfolio standard requirement under the Renewable Energy Act of 2008.