Listed firm SPC Power Corporation has asked the Energy Regulatory Commission’s (ERC) to reconsider the P4.024 million penalty it enforced on the forced outages" of its diesel power plant operated by subsidiary SPC Island Power Corporation that breached the limit allowed by the regulatory agency.
In a disclosure to the Philippine Stock Exchange (PSE), Atty. Maria Luz Caminero, compliance officer of SPC Power, stated that “SPC Island Power Corporation (SIPC) has a pending motion for reconsideration before the ERC filed on October 29, 2021 praying for the reconsideration of its decision imposing an administrative fine of P4,024,200.00 on SIPC.”
The company emphasized that the "plant outage days" reckoned on the penalty imposition had been for 98 days, way above the allowable 14 days of unplanned outages for diesel plants.
The ERC primarily stated that “excess forced outages” logged by apprehended power generation companies are in violation of Resolution No. 10, series of 2020, which prescribes the reliability indices set for each technology in the electricity generation segment of the deregulated power industry.
“With regard to SPC Power Corporation, it submitted an explanation to the ERC on why it should not be penalized for the violation of ERC Resolution 10, series of 2020,” Caminero stressed.
She qualified that as early as July 30 last year, SPC has submitted its explanation, but until this date, “SPC has not received any order/decision from the ERC on this issue.”
Following the rotational blackouts last year that was reportedly triggered by simultaneous outages of electric generating units, the ERC had summoned power plant owners and operators to explain the excessive unplanned shutdowns of their facilities.
But since the ERC has not been convinced on the justifications provided by the GenCos, it ended up imposing the penalties against the erring industry players.
It was in December 2020 when the ERC issued its resolution setting forth the "forced outages cap per technology" for the power sector. ERC directed the power generation firms to strictly comply with that mandate starting in their year 2021 operations.
Given the recurring dilemma of unplanned power plant downtimes in the country, the ERC, along with the Department of Energy (DOE), had been constantly reminding the industry players to strictly adhere to performance and reliability standards set by the government – especially when demand would peak during the summer months; and any breach or non-compliance to policies and industry rules shall warrant penalty enforcements.