Contestable power market more evenly distributed — PEMC
RETAIL electricity suppliers recorded a “significant change” in their corresponding share in the number of contestable customers during the first quarter, with dominant player Manila Electric Co.’s (Meralco) unit posting a “downward trend,” said Philippine Electricity Market Corp. (PEMC) in its latest report.
PEMC, the governance arm of the wholesale electricity spot market, said as of March 2017, Meralco’s local retail electricity supplier (RES) cornered about 34% of the contestable market, or those whose consumption rose to the threshold set by regulators, significantly lower than its 48% share recorded in December 2016.
“As such, the shares in terms of the number of registered Contestable Customers served are now divided among more suppliers which may well have influenced such decrease in [Meralco local RES]’s share,” PEMC said.
PEMC, which also serves as the registry for all entities that enter the contestable market, said despite’s Meralco’s declining share it “remained the top supplier for the first quarter 2017” in terms of the number of contestable customers served.
The report reflects the early outcome of regulatory moves to open the market to more players by allowing a consumer of at least one megawatt (MW) of electricity to enter into a power supply contract of RES licensed by the Energy Regulatory Commission (ERC).
Retail competition is said to result in more electricity suppliers, which in turn could bring down power costs. Moves to lower the threshold to include those consuming at least 750 kilowatts ( kW) have been put on hold by the Supreme Court.
Next to Meralco’s local RES, which supplies those within the utility’s franchise area, the second biggest had a 19% share, taken up by Aboitiz Energy Solutions, Inc. In third place were Trans-Asia Oil and Energy Development Corp. and AdventEnergy, Inc. both with 9%.
Rounding out the top five were DirectPower Services, Inc., San Miguel Electric Corp. and Ecozone Power Management, Inc. — with 5% each.
The rest of the suppliers had shares ranging from less than 1% to about 4%, the PEMC report shows.
As of the March 2017 billing period, there were a total of 741 registered contestable customers, up from 492 during the previous quarter. The market also recorded a total of 27 registered RES, 12 registered local RES and 21 registered “suppliers of last report,” which take over the business of those that fail to deliver on their supply contracts.
PEMC said of the total contestable customers that registered with the agency, 663 belong to the one MW and above contestability threshold, while 78 belong to the 750 kW to one MW bracket. It said majority of 694 registrants are in Luzon and the remaining 47 are in the Visayas.
Of these consumers, 412 are engaged in industrial activities while 329 are into commercial businesses. The total registrants account for 48% of the 1,555 electricity endusers that were issued certificates of contestability by the ERC.
During the review quarter, the total energy consumption of the customers stood at 2,765 gigawatt- hours, or higher by 10% compared with the previous quarter’s 2,480 gigawatt-hours. —