Nasecore to ERC: Evaluate circular on CSP
ERC
MANILA, Philippines — Advocacy group National Association of Electricity Consumers for Reforms, Inc. (NASECORE) called on the Department of Energy (DOE) to evaluate its circular on the competitive selection process (CSP) or its government-mandated method in selecting power suppliers.
NASECORE claimed that the circular on CSP “failed to uphold its core objectives of transparency, fair competition, and least-cost power supply procurement.”
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“Our continuing monitoring indicates that the CSP mechanism has not delivered meaningful market competition. On the contrary, it has largely preserved the dominance of incumbent and affiliated generation companies, especially in the franchise area of Meralco, the country’s largest distribution utility,” the group’s letter to DOE reads.
“No new independent or reliable power suppliers have been introduced into Merlaco’s generation mix in the past decade. Instead, electricity rates under its power supply agreements (PSAs) have consistently risen-contrary to the CSP policy’s original intent,” the letter signed by NASECORE President Pete Ilagan further says.
The group also cited the recent decision of the Energy Regulatory Commission (ERC) to approve a PSA rate of P5.7816/kWh (kilowatt-hour), plus P0.6938 VAT (value-added tax) and P0.25 Line Rental, totaling P6.7254/kWh, as stated under the commission’s case no. 2024-027 RC (regulatory case).
“In comparison, the ERC previously approved rates of only P4.0459/kWh under ERC Case Nos. 2019-083 RC and 2019-081 RC, both dated December 10, 2019. This substantial rate disparity further highlights the policy failure in ensuring least-cost procurement,” NASECORE explained.
In line with this, NASECORE recommends DOE to publicly declare the current CSP framework a policy failure; as well as launch DOE-led, multi-stakeholder review of the CSP circular with participation from consumer groups and non-affiliated generators, among others.
“The CSP’s repeated failure to deliver new suppliers or fair rates— particularly in Meralco’s case, exposes deep flaws in policy design and enforcement. Without urgent reform, Filipino consumers will remain at the mercy of anti-competitive arrangements and ever-rising electricity costs,” the letter says.
“We call on your office to act swiftly and decisively in realigning our energy procurement system with the public interest. NASECORE reaffirms its full support and readiness to engage in this critical policy reform process,” it concludes.
