Philippine Energy Policy Wiki

DC2011-06-0006 — RCOA Steering Committee Creation

Status
operative
Confidence
high
Effective date
2011-07-02

Department Circular No. DC2011-06-0006, issued 17 June 2011 by DOE Secretary Jose Rene D. Almendras. Circular creating the Retail Competition and Open Access (RCOA) Steering Committee to define policies and ensure appropriate conditions for efficient transition to RCOA implementation.

Implements EPIRA (RA 9136) §37 mandate to DOE to supervise electric power industry restructuring and formulate necessary rules/regulations [DC2011-06-0006, Whereas, 2011-06]. EPIRA §31 mandates RCOA implementation subject to five preconditions [DC2011-06-0006, Whereas, 2011-06]:

  1. Establishment of Wholesale Electricity Spot Market (WESM) [DC2011-06-0006, Whereas, 2011-06]
  2. Approval of unbundled transmission and distribution wheeling charges [DC2011-06-0006, Whereas, 2011-06]
  3. Initial implementation of cross-subsidy removal scheme [DC2011-06-0006, Whereas, 2011-06]
  4. Privatization of at least seventy percent (70%) of total NPC generating asset capacity in Luzon and Visayas [DC2011-06-0006, Whereas, 2011-06]
  5. Transfer of management and control of at least seventy percent (70%) of total energy output of NPC-contracted power plants to Independent Power Producers Administrators (IPPAs) [DC2011-06-0006, Whereas, 2011-06]

ERC Resolution No. 3, Series of 2007 (24 January 2007) established RCOA timeline for Luzon: full RCOA to commence six (6) months from ERC declaration date, subject to compliance with EPIRA preconditions and two vital requirements: (a) adequacy and establishment of necessary infrastructures (transmission networks, generation supply, customer switching system); and (b) promulgation of all pertinent ERC rules and regulations [DC2011-06-0006, Whereas, 2011-06].

ERC completed RCOA regulatory framework comprising twelve components [DC2011-06-0006, Whereas, 2011-06]:

  • Rules on Distribution Service and Open Access
  • Rules for Customer Switching
  • Rules for Supplier of Last Resort
  • Rules on Rate Filing by Supplier of Last Resort
  • Rules on Contestability
  • Business Separation Guidelines
  • Code of Conduct for Competitive Retail Market Participants
  • Guidelines for Issuance of Licenses to Retail Electricity Suppliers
  • Competition Rules and Complaint Procedures
  • Rules for Setting Distribution Wheeling Rates
  • Rules for Setting Transmission Wheeling Rates
  • Rules for Setting Electric Cooperatives’ Wheeling Rates

EPIRA-IRR Rule 12, Section 3 authorized ERC to declare, after due notice and public hearing, initial RCOA implementation [DC2011-06-0006, Whereas, 2011-06]. In ERC Case No. 2011-004-RM (6 June 2011), ERC declared compliance with preconditions for initial RCOA implementation [DC2011-06-0006, Whereas, 2011-06].

Purpose and DOE mandate

DOE mandated under EPIRA to provide mechanism for integration, rationalization and coordination of various government energy programs including RCOA implementation [DC2011-06-0006, Whereas, 2011-06]. To ensure efficient and effective RCOA implementation, DOE issues guidelines providing transition framework and synchronizing preparatory actions to ensure sufficiency of existing rules, infrastructures and institutional requirements for achieving EPIRA objectives [DC2011-06-0006, Whereas, 2011-06].

RCOA Steering Committee composition and structure

RCOA Steering Committee created to ensure appropriate conditions for efficient transition to RCOA implementation [DC2011-06-0006, §1, 2011-06]. Committee composed of representatives from [DC2011-06-0006, §1, 2011-06]:

  • Department of Energy (Chair)
  • Philippine Electricity Market Corporation (Member)
  • National Electrification Administration (Member)
  • National Power Corporation (Member)
  • National Transmission Corporation (Member)
  • Power Sector Assets and Liabilities Management Corporation (Member)
  • National Grid Corporation of the Philippines (Member)

Subject to acceptance, Department of Finance, Energy Regulatory Commission, and Philippine Economic Zone Authority invited as members [DC2011-06-0006, §1, 2011-06]. ERC serves as co-chair upon acceptance [DC2011-06-0006, §1, 2011-06]. Other government instrumentalities may also be invited [DC2011-06-0006, §1, 2011-06]. Committee may invite private sector representatives from distribution utilities, generation companies, and other industry stakeholders as it deems necessary [DC2011-06-0006, §1, 2011-06].

Committee responsibilities and functions

Steering Committee responsible for [DC2011-06-0006, §2, 2011-06]:

a. Rules review and policy development: Review existing RCOA rules and procedures, develop and recommend policies to implement systems and processes needed to govern retail market transactions [DC2011-06-0006, §2, 2011-06]

b. Transition planning: Develop timelines and action plans necessary to ensure smooth transition to full competitive environment [DC2011-06-0006, §2, 2011-06]

c. Interagency coordination: Coordinate with various government agencies or units, industry sectors and other entities to implement regular monitoring and feedback mechanism to concerned parties [DC2011-06-0006, §2, 2011-06]

d. Rules forum: Provide forum for recommendations on all pertinent rules and guidelines [DC2011-06-0006, §2, 2011-06]

e. Information and education: Formulate information and education campaign about RCOA [DC2011-06-0006, §2, 2011-06]

f. Other functions: Perform other related functions and responsibilities as may be necessary [DC2011-06-0006, §2, 2011-06]

Secretariat and effectivity

Electric Power Industry Management Bureau (EPIMB) serves as Secretariat for RCOA Steering Committee [DC2011-06-0006, §3, 2011-06].

Circular takes effect immediately fifteen (15) days from publication in a newspaper of general circulation [DC2011-06-0006, §4, 2011-06].

Full text: Cleaned copy