Qualified big-ticket contestable customers in Mindanao can finally exercise ‘power of choice’ on contracting their electricity services as the Energy Regulatory Commission (ERC) has already opened that segment of the industry for retail competition.

Similar to the threshold for Luzon and Visayas grids, the regulatory body enforced that those end-users with average monthly peak demand of at least 500 kilowatts (kW) can already be covered in the Retail Competition and Open Access (RCOA) policy of the restructured power industry.

Being classified as contestable customers, these Mindanao end-users can now negotiate for their required volume as well as desired tariffs with their preferred retail electricity suppliers.

Then given the interconnection of all grids, the Mindanao customers can also opt for power suppliers from either Luzon or Visayas grids.

As directed by the ERC, “Mindanao consumers with an average monthly peak demand of at least 500kW for the twelve (12) months preceding March 26, 2024 will be allowed to contract with any licensed/authorized supplier of electricity on a voluntary basis.”

Based on the experience of many contestable customers, several of them were able to negotiate for a price lower than the regulated rate of incumbent power utilities and they can also demand for the quality of service that they desire.

Nevertheless, since most RES deals already veered away from ‘fixed price contracts’ and are instead inclined toward fuel pass-through provisions, the contestable customers must prudently exercise their negotiating power so they can sign contracts with reliable and cost-effective suppliers.

As emphasized by ERC Chairperson Monalisa C. Dimalanta, the Commission views the opening of the Mindanao market to retail competition with “immense optimism”; and they intend to promote this regulatory regime enthusiastically with consumers in the southernmost power grid in the months ahead.

“Over the next few months, the ERC will conduct an aggressive information campaign to capacitate our contestable customers with the ability to effectively transact in the retail market and properly discern the best terms of power supply suited to their needs,” the chief regulator stressed.

And while broadening the base of competition in the industry, the regulatory body indicated that it will also “continue to support and ensure that customers in Luzon, Visayas and Mindanao will be able to exercise meaningfully their power to choose suppliers as a way to realize reasonable price of electricity.”