Antitrust body pursues probe of power firms

The Philippine Competition Commission (PCC) yesterday signed a memorandum of agreement with the Energy Regulatory Commission (ERC) to collaborate on investigations that involve power sector players.

The PCC is assessing whether recent power plant outages were valid “unplanned breakdowns” that inevitably affected supply conditions or were actually “manipulated” in order to raise electricity prices.

In April, the PCC said it would look into allegations of possible collusion or abuse of dominance of certain power generators following “simultaneous shutdowns that may have caused an artificial supply shortage and consequently a hike in electricity prices.”

“Our partnership (with ERC) allows for the sharing of information and coordination of enforcement actions toward a more robust competition landscape in the energy sector,” PCC chair Arsenio M. Balisacan said in a statement.

He said the teamup with ERC completed a tripartite effort along with the Department of Energy (DOE), with which PCC signed in June a separate agreement on cooperation toward the same objective.

The MOA also facilitates consultations with institutions or firms such as Philippine Electricity Market Corp., National Grid Corporation of the Philippines and generation companies to obtain relevant information.

The PCC, DOE and ERC are working together to coordinate probes on alleged collusion or abuses of dominance in the power industry through information exchange and fact-finding.

The tripartite drive combines “the policy mandate of the DOE, the regulatory functions of the ERC and the market competition lens of the PCC,” Balisacan said.

He added that with the ERC onboard, the three agencies were expected to make headway in probing allegations of collusion or abuse of dominance amid a series of shutdowns among power plants “that may have contributed” to increases in electricity prices earlier this year.

The ERC has announced neither a wrap-up nor findings of an investigation that it was conducting. ERC officials said both new and aging power plants in the Luzon grid were among those that suffered forced or unscheduled outage as well as those undergoing scheduled maintenance.

Despite the plant outages, Manila Electric Co. has lowered its overall rates thrice—for the May, June and July billing cycles—for a total of 57.44 centavos a kilowatt-hour.

Meralco, which accounts for about three-quarters of power demand in Luzon, said generation charges had been going down in the past two months due to the strengthening of the peso against the dollar as well as lower fuel prices.

Data from the DOE showed that there were 11 generators that accounted for a total of 1,759 megawatts of generating capacity that were under unplanned outage.

Among these were units of Malaya plant, Mak-Ban, Kalayaan plant, Pagbilao, South Luzon Thermal Energy’s plant, GNPower plant, SEM-Calaca, Southwest Luzon Power Generation’s plant and Tiwi plant.