TWG approves draft bill amending ERC charter

A HOUSE of Representatives technical working group (TWG) approved a draft measure seeking to restructure the Energy Regulatory Commission (ERC), which is expected to compel the commission to expedite decision making in aid of lowering power costs.

The House energy panel is expected to approve the committee report on the bill on Tuesday, Party-list Rep. Sergio C. Dagooc, who headed the TWG told BusinessWorld.

The measure calls for power supply agreements (PSA) approved by the ERC to “embody the principles of quality, affordability, sustainability, and reliability,” according to a copy of the draft bill obtained by BusinessWorld.

The regulator is required to act on PSA applications within 60 days. Failing to act would result in the application being automatically approved.

It also directs the ERC to issue benchmark prices “that are deemed reasonable for both the end-users and the operations of generation, transmission, and distribution entities.”

The ERC should consider the load density, sales mix, cost of service, delivery voltage, among other technical considerations, in setting benchmark rates, according to the draft bill.

Under the measure, the power regulator would be granted “quasi-judicial” and “quasi-legislative” powers to address such matters within 270 days. Administrative proceedings should be resolved within 60 days.

“In my assessment, 60% of the problem with not achieving the objective of EPIRA lies with the ERC because they are the regulators for all power industry players,” according to Mr. Dagooc, also a member of the House energy committee.

“Delays in the provision of capital expenditures and various power supply agreements result in higher electricity prices. We think that resolving issues in the ERC, with the delays, about 60% of our problems with the cost of electricity could be resolved,” he added.

Discussions to amend ERC are part of a broader effort to amend the 2001 Electric Power Industry Reform Act (EPIRA), the law that deregulated the energy industry.

The government is currently looking into amending the 23-year-old power law, with President Ferdinand R. Marcos, Jr. including changes to EPIRA as a priority measure for the 19^th Congress.

The chamber is looking to approve a bill amending EPIRA before it goes on break by mid-December, Speaker and Leyte Rep. Ferdinand Martin G. Romualdez said in July.

“We’ll try to meet the timeline,” Mr. Dagooc said.

He said the panel is also looking at amending EPIRA provisions governing transmission and distribution panels after they pass the bill strengthening the ERC.

EPIRA was widely believed to have failed in its intent to lower electricity consumer costs, with Philippine electricity rates among the highest in the Southeast Asian region, according to a 2022 Ateneo de Manila University report. — Kenneth Christiane L. Basilio