ERC issues revised licensing rules for power plant operations
At A Glance
- Snags in the approval of licenses or COCs for power plant operations can disrupt electricity supply in the country, thus, the revised rules laid down by the ERC will avert that kind of dilemma in the industry.
The Energy Regulatory Commission (ERC) has issued its revised rules on the issuance of certificate of compliance (COC) or the license that will govern the standards, requirements as well as procedures in the operations of power plants in the country – primarily the greenfield or new electric generating facilities.
The grant of COC to a power facility, according to the ERC, is in keeping with the prescription of Section 6 of Republic Act No. 9136 or the Electric Power Industry Reform Act (EPIRA), which serves as the bible of policies and regulatory frameworks in the country’s restructured power sector; and complemented by Section 4, Rule 5 of the law’s implementing rules and regulations (IRR).
The ERC specified that under the revised rules, COCs are now only required “for the operation of new generation facilities, without the need for renewal but with obligation to maintain valid and subsisting the underlying permits.”
The regulatory body added that “this introduction of non-expiring COCs under the 2023 revised COC rules highlights the ERC’s agency-wide efforts to ensure energy security and to simplify regulatory processes for entities, so long as applicable conditions are met.”
Under previous rules, the COC has only been valid for five years; and renewal of licenses had to be sought from the Commission prior to expiration, that way, the power plants could continuously operate.
Nevertheless, industry experience had shown that lag in regulatory processes at the ERC had placed some power plants on the edge of non-operation, and that was mainly due to delayed approvals of renewal of their COC applications. That in turn had compromised the country’s overall bid for energy security and power supply reliability.
In the modified rules, the ERC similarly prescribed the lists of requirements for COC applications covering generation facilities as well as the entities with self-generation facilities (SGF), then the distribution utilities (DUs) on behalf of its qualified end-users.
“To encourage submission of COC applications under the 2023 Revised COC Rules, a leniency period of six (6) months has been provided for entities with SGF that do not have COCs yet,” the Commission stressed.
The ERC further announced that the facilities classified by the Department of Energy (DOE) as a project of national significance, and the entities with distributed energy resources (DER) shall also be covered by the amended COC rules.
For applications seeking provisional authority to operate (PAO), a separate application process as well as conditions and requirements shall also be enforced by the ERC.
The regulatory body reiterated that the revised rules “marks a significant change in the processing and issuance of COCs to determine generation facilities’ compliance with technical, financial, environmental, and other standards in order to ensure the reliable and continuous supply of electricity.”