The Energy Regulatory Commission (ERC) has apprised Congress that it already re-opened investigation on ‘market collusion’ raps that had been hurled against the power generation companies (GenCos) since 2013 for extraordinary surge in prices at the Wholesale Electricity Spot Market (WESM).
ERC Commissioner Floresinda B. Digal sounded off in a budget briefing in the House of Representatives that resumption of hearings on some cases had already been carried out, while others are waiting for a verdict from the Court of Appeals (CA) on a pending case relating to the matter.
“These cases are on different stages, but primarily there is a pending petition before the CA.
But the other cases, we have resumed hearings,” Digal noted.
The ERC official has not specified the cases or the GenCos that had already been subjected for investigation by the ERC; and which ones are affected by the pending case at the appellate court.
The allegation was predicated on simultaneous shutdowns of power plants – including forced outages which coincided with the maintenance downtime of the Malampaya gas production facility – plus the supposed withholding of capacity of some players when they should have been called for dispatch by the system operator.
That ‘perfect storm’ in the restructured power sector had in turn caused unprecedented spikes of roughly P5.00 per kilowatt hour (kWh) in the electric bills of power utility giant Manila Electric Company.
Party List Representative France Castro was prompted to inquire on the status of the alleged ‘collusion complaint’ versus power generation firms, given that the case has not really moved on the investigation phase for roughly 10 years already.
ERC Chairperson Monalisa C. Dimalanta expounded that the regulatory body has its hands tied on some cases “because we are also waiting for the resolution of certain issues in the high court, that’s why we cannot also move at the ERC.”
When Castro asked if the ERC chief can exercise fairness in her decision given that the GenCos under Aboitiz Power had likewise been included in the market gaming imputation, Dimalanta stated that “fairness can be assured on the part of the ERC, and I’ve also made the same statement when we had clarificatory hearings with Meralco and the generators because that was also the question of the consumers.”
Prior to her appointment at the ERC, Dimalanta served as chief legal counsel at Aboitiz Power, the energy investment arm of the Aboitiz conglomerate.
The ERC probe on the ‘market duplicity’ allegations at the WESM practically stalled since 2014 – and the last step taken by the regulatory body had been the creation of independent investigation unit (IU) that had been intended to scrutinize the behavior of market participants within the questioned trading days and intervals in the November-December 2013 period.
The target of the regulatory agency then was for the IU to independently “evaluate pieces of evidence” – and once the probe process had been completed, the designated body will file the corresponding complaint to the ERC if it could establish ‘prima facie evidence’ against market participants.
The IU was created as an ad hoc body – and it was targeted to be independent from the Commission – and its sole purpose was to extensively investigate the circumstances relating to the unprecedented spikes in electricity prices in the November-December 2013.
The ERC emphasized then that there was a need to extensively validate and analyze at least 1,440 transactions in the WESM within the specified supply months – and these primarily covered market trading data of 24 hours for 30 days within two-month stretch.