ERC eyes PEZA as testing ground for new policies
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To create a more adaptable policy framework for the energy sector, the Energy Regulatory Commission (ERC) is pushing to implement a “regulatory sandbox” system where new ideas and solutions can be rigorously tested before wider implementation.
Outgoing ERC Chairperson Monalisa Dimalanta said that the initiative, potentially starting with the Philippine Economic Zones (PEZA), will resemble the successful program implemented by the Bangko Sentral ng Pilipinas (BSP) for financial technology (fintech).
“I have been pushing for the Commission to adopt a regulatory sandbox framework similar to what the BSP adopted, that led to the birth and growth of the fintech industry in the country,” Dimalanta told Manila Bulletin.
She added, “The framework would allow for space for innovation to grow and for solutions for industry issues to be tested in a somewhat controlled environment.”
The ERC intends to utilize PEZA economic zones as testing grounds for new ideas and solutions to industry challenges. The results from these “sandboxes” will then inform the commission's development of new regulatory programs.
Dimalanta said PEZA is suitability for this initiative, stating it “offers a good test environment or sandboxes, given that their areas/zones are geographically defined and impact can be contained.”
She added that by collaborating, the ERC can facilitate the testing of proposed solutions and innovations within PEZA ecozones under the regulatory sandbox framework.
This collaboration will be formalized through a memorandum of agreement (MOA) with the PEZA, with a signing planned for July 14.
Dimalanta earlier said that she had met with PEZA Director General Tereso Panga to address concerns from locators regarding electricity cost management.
“I met with Mr. Panga last week… Hopefully, there won’t be any objections from the new commissioners or [the] new chair… Mr. Panga [and I] were discussing a new MOA between ERC and PEZA to address the issue of PEZA locators. You’re right, PEZA locators have a different incentive design. It has to require a different set of solutions,” she stated.
She also noted the distinct regulatory landscape within PEZA ecozones: "In PEZA-owned zones, [it] regulates the distribution supply. So we also have to discuss how to address the rates. Because it’s different outside PEZA."