Razon group forms retail power marketing unit
By Myrna M. Velasco – August 21, 2022, 8:00 PM
from Manila Bulletin
Prime Infrastructure, the energy investment arm of the Razon group, will be joining the growing retail electricity suppliers (RES) catering to the power needs of contestable customers, or the segment of end-users that can directly negotiate or contract with their preferred service providers.
According to Prime Infra documents filed with the Securities and Exchange Commission (SEC), the Razon group had recently set up PrimeRES Corporation to serve customer segment that are qualified to exercise their “power of choice” in selecting their power suppliers.
Apart from its RES business arm, Prime Infra is also preoccupied with the implementation of various power plant projects, including its offer of 850-megawatt mid-merit capacity to Manila Electric Company (Meralco) that will be coming from solar and battery energy storage facilities, as well as its other 500MW mid-merit capacity tender that will be drawn from separate installation of pumped storage hydro with battery storage technology coupling.
The Razon group has not listed any targets yet on its power retail marketing but said it expects intense competition with the existing “big boys” of the power sector.
“The group believes that it will face competition in both the developments of new power generation facilities, the acquisition of existing power plants and competition for financing,” the Razon firm reiterated.
Nevertheless, it emphasized that the anticipated shortfall in electricity supply against the backdrop of growth projections in the domestic economy could serve as a major stimulus for additional power generation investments in the country.
In the Retail Competition and Open Access (RCOA) space, in particular, the current threshold that can be served by retail suppliers are those customers with peak demand of 500 kilowatts (kW) and up, based on the rules prescribed by the Energy Regulatory Commission.
By December this year, retail competition in the country’s liberalized power market will also be expanded to allow “aggregation of capacity” by end-users within a contiguous area, including those in subdivisions, villages or other areas that are proximate to each other.
Many customers who have availed of retail electricity from their chosen suppliers have vouched of cheaper power costs and better quality of service.
As RES entity, PrimeRES can also secure a license from the ERC to join the Green Energy Option Program (GEOP) being enforced by the government. In that sphere, the company can satisfy end-users’ preference for power supply sourced from renewable energy-generated capacities.
The mandated usage threshold under GEOP had been set lower at 100kW because the government has been fortifying the market for RE so it can concretize the country’s energy transition agenda.
