THE Department of Energy (DoE) is drafting a circular that will allow electricity consumers to move back to distribution utilities after they were required by law to source their power supply from licensed retail electricity suppliers.
Undersecretary Felix William B. Fuentebella said there were electricity users who have questioned provisions of rules that barred them from moving back as captive customers of the distribution utility that holds the franchise in their area.
“We’ll come up with circulars addressing the voluntary aspect [of the rules],” he told reporters. The proposed circulars should allow consumers to choose whether they wanted to be a captive customer or one that has contract with a retail electricity supplier (RES).
He said the proposed circulars would allow “flexibility” on the part of contestable customers, or those whose consumption falls within the threshold set by both the DoE and the Energy Regulatory Commission (ERC).
Under the previous DoE circular DC2015-06-0010, electricity end-users with a monthly average peak demand of at least one megawatt (MW) for the preceding 12 months will become part of the “contestable market” when rules covering retail competition and open access (RCOA) take effect.
Two years afterwards, the threshold level for the contestable market will be reduced to 750-999 kilowatts (kW). The ERC is required to evaluate the performance of the electricity market and gradually reduce the threshold level until it reaches household demand level.
ERC Resolution No. 10, Series of 2016, adopted the revised rules for contestability, which also mandated consumers with an average peak demand of at least one MW to enter into a retail supply contract with a RES 60 days before Dec. 26, 2016.
However, the Supreme Court issued a temporary restraining order days before Feb. 26, 2017, when the switch was to become mandatory for the 1-MW customer. It also put on hold the lowering of the threshold on June 26, 2017, which would have made the switch mandatory for those consuming 750-999 kW.
Mr. Fuentebella said one of the circular would address the request of contestable customers to be allowed to move back to their distribution utility, which the RCOA rules have barred.
“They’re asking for guidelines. While the TRO remains, what do we do,” he said.
He said another circular will address questions on so-called “local” RES, or an affiliate of a distribution utility that functions as a retail electricity supplier. He said the proposed circular would allow a local RES to continue serving the captive market if it can prove that it is a separate entity from its parent distribution utility.
“[The proposed circular] It’s for public consultation,” he said, adding that the DoE would look into aspects of the rules that would avoid being called out for contempt of the Supreme Court TRO, “and proceed from there.” — Victor V. Saulon
