ERC Begins Reviewing PSAs

The Energy Regulatory Commission (ERC) has begun reviewing power supply agreements (PSAs) between distribution utilities (DUs) and generation companies, specifically the electric cooperatives (ECs), in an attempt to lower the electricity rates in the Philippines.

The survey on PSAs has already been previously started via a “PSA caravan” placed in the Cordillera Administrative Region and Region I, which will be expanded nationwide.

One of the key campaign promises of President Ferdinand Marcos Jr. was to lower electricity rates, specifically, those served by the ECs have been voicing out high electricity bills ranging from ₱16 to ₱21 per kilowatt hour.

ERC Chairperson Monalisa C. Dimalanta has mentioned that there is still space for rates to go down with the review of PSAs due to the number of the supply deals only being provisionally granted, meaning there would still be leeway for adjustments in the final approval.

“The generation charge comprises 50 to 60% of the power bills. So, if that goes down, power bill goes down,”  mentioned Dimalanta.

She says that “many PSAs are still under provisional authority, meaning, the rates are still only temporarily approved. ERC still has to make final determination of those rates.”

Additionally, the PSA caravan by the ERC is in the supply mix on procurement capacities of the DUs which will affect the reliability and power rates of the consumers.

“Supply should follow demand profile – each DU or EC will have a different mix depending how much their customers need for baseload, mid-merit, and peaking capacities,”  said Dimalanta.

Source: Manila Bulletin