DOE pushes ‘aggregation level’ in power retail competition

By Myrna M. Velasco – October 16, 2017, 10:00 PM

from Manila Bulletin

Aggregation at 500 kilowatts (kW) consumption level, that may include households within contiguous or adjacent areas, would already be the next phase of electricity retail competition and open access (RCOA) based on a modified policy being cast by the Department of Energy.

But as envisaged by the department, this shall be done on voluntary basis so it can get away with the legal hurdle that had hobbled RCOA when it was attempted on a mandatory scheme February this year.

The DOE has issued two draft department circulars that shall set the direction of retail competition in the power sector – with intended “voluntary implementation” and to bring down threshold levels to 750 kilowatts and then aggregation at 500kW. Such policies are targeted to kick off 2018.

“The RCOA policy on the demand side requires contestable customers with an average peak demand of 500kW and above to voluntarily participate in the retail market,” the DOE has noted.

It added that demand amalgamation may be done by an aggregator “who may purchase and resell electricity on a group basis.”

The two draft DOE Circulars had been set for public consultation last October 10, with the stakeholder-inputs eyed incorporated in the fine-tuning of the final RCOA policies.

The voluntary paradigm of implementation will somehow negate the legally questioned “mandatory mode” of RCOA, of which case is still pending with the Supreme Court.

That then stalled retail competition in the restructured electricity sector at 1.0MW, instead of earlier proposals to already reduce the threshold to 750kW.

For Energy Secretary Alfonso G. Cusi, their job now is “to properly explain to the industry players our way forward in implementing the “power of choice” provisions of the EPIRA and one of them is the provision on retail competition and open access.”

The energy chief is at least batting for a transparent system of the RCOA enforcement and to level the playing field for all stakeholders, including ease of switching on the part of consumers exercising their ‘power of choice’ via the retail market.