From energy regulation to deregulation (Part 3)

This is a continuation of the previous articles this year in this column, "From energy regulation to deregulation" Part 1 (Jan. 25) and Part 2 (Feb. 6).

- Bienvenido S. Oplas Jr.

In Part 1, the three regulations I discussed were price control via the secondary price cap in the Wholesale Electricity Spot Market, high reliability standards and fines, and price regulation after competitive selection process (CSP) has been done.

In Part 2 I discussed a dangerous regulation of "benchmarking rates" not only for transmission and distribution but also for procurement of necessary power supply for distribution utilities (DUs) and ancillary services (AS), explained five reasons why the policy is wrong.

In Part 3 I will tackle prolonged regulation by the Energy Regulatory Commission (ERC) on already awarded CSP procurement of ancillary service power agreement (ASPA) by the National Grid Corp. of the Philippines (NGCP).

From what I gathered, NGCP implemented AS CSP in early 2023 to procure its ASPAs. Many or most ASPAs that time were either expired or nearly expiring. The agreement in mid-2023 then among the Department of Energy (DOE), ERC, NGCP and generation companies (gencos) was that ERC would fast-track the approval of those ASPAs that already won in the CSP.