Lopez energy firm fined P 1M by ERC
First Gen Corp. said one of its subsidiaries was reviewing a decision of the Energy Regulatory Commission (ERC) that slapped a P1-million penalty on the firm for alleged anticompetitive behavior that led to high prices at the wholesale electricity spot market in 2017.
First Gen was referring to Prime Meridian Powergen Corp. (PMPC), the owner of the 97-megawatt Avion power plant, the newest in the Lopez-led group’s portfolio of natural gas-fired assets at the Clean Energy Complex in Batangas City.In a 10-page decision dated July 10, the ERC said it received a report of five “interesting” pricing events that occurred three years ago.
“The report highlighted that on (Wednesday, Aug. 16, 2017, at 2 p.m.). Avion Unit 2 was observed to have deviated from its typical offer pattern,” the ERC said.
“Upon verification, Avion indeed changed its bidding pattern during the subject trading hour with an offer price of P32,000 per megawatt-hour, which was subsequently cleared in the market,” it added.The regulator said this was a “significant increase” from the P5,474.55 per mwh that Avion offered during the same day of the week at the same time of the day from July 2017 to February 2018.
Noting that deliberations and evidence that PMPC submitted were not persuasive, the ERC said it found the PMPC to have abused its market power and behaved in an anticompetitive manner—a violation of Section 45 of the Electric Power Industry Reform Act. Under the law, the penalty for such breach is P50,000 to P50 million, as determined by the ERC.
“A stern warning is likewise issued, that repetition of the same or similar act will be dealt with more severely,” the ERC said. INQ
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