DC2021-10-0031 (AS-CSP Policy, October 2021)
Title: Prescribing the Policy for the Transparent and Efficient Procurement of Ancillary Services by the System Operator
Issued: October 2021
Signed by: Secretary Alfonso G. Cusi
Pages: 18 pages (body) + Annex A (TOR template)
Source: raw/regulations/dc2021-10-0031.md (cleaned from OCR)
Related instruments: DC2019-12-0018 (General AS Framework, Dec 2019); DC2021-03-0009 (Reserve Market Framework, Mar 2021, now supplemented by DC2023-09-0026)
Document Purpose
Operationalizes the competitive selection process (CSP) for the System Operator’s (NGCP’s) procurement of Ancillary Services under firm bilateral contracts (ASPAs). Parent framework is DC2019-12-0018. Directed by DC2021-03-0009’s mandate for competitive selection of AS contracts. The Reserve Market (DC2021-03-0009/DC2023-09-0026) handles the co-optimized real-time channel separately.
Key Provisions
SECTION 1 — General Principles (6 items)
- Transparency and non-discriminatory treatment of all ASPs
- Promote competition through equal bidding opportunity
- Protect public interest — sufficient and least-cost AS supply
- Accountability — timely compliance with CSP steps and certification requirements
- All AS contracts via competitive procurement under this Circular
- Forward contracting encouraged per DC2019-12-0018 §12.6
SECTION 2 — Scope
Applies to: SO (NGCP), Market Operator (IEMOP), ASPs, TransCo, ERC, Distribution Utilities. All pending ASPAs not yet filed before effectivity are excluded.
SECTION 3 — Definitions
- AS: Services supporting transmission reliability per Grid Code
- ASAPP: Annual procurement plan (10-year projection)
- ASP: Provider with SO/ERC-accredited third-party certification
- ASPA: Firm bilateral contract for AS delivery
- Grid Users: High-voltage backbone users (GenCos, directly-connected customers, DUs)
SECTION 4 — ASAPP
- Annual submission to DOE: 31 March
- Posted on SO website: 30 April
- Contents: AS types per grid; timing; existing ASPAs; monthly levels; 5-year historical hourly data; 10-year projections
SECTION 5 — TPBAC
- 5 voting members: SO technical + SO bidding-experienced + SO lawyer + IEMOP rep + TransCo rep
- NGCP BOD = observer only (no vote)
- Quorum = simple majority; decisions = majority of members present
- TWG (SO technical/legal/financial staff) and Secretariat support the TPBAC
SECTION 6 — CSP Observers
- DOE, ERC, and NEA — invited in writing 7 working days in advance
- Access to all documents; video recording required for pre-bid and opening
- Absence does not nullify proceedings
SECTION 7 — AS-CSP Procedure
| Step | Timeline |
|---|---|
| First CSP | Within 6 months of effectivity |
| Pre-bid conference | Within 14 days of ITB publication |
| Supplemental Bid Bulletins | At least 14 days before bid deadline |
| DOE pre-approval | Required for TOR + draft ITB before publication |
| Bid format | Two sealed envelopes (technical/legal + financial) |
| TPBAC award recommendation | To NGCP BOD within 5 days |
| Joint ASPA filing with ERC | Within 15 working days of signing |
| Total CSP duration | 90 calendar days (ITB to signing) |
| Maximum ASPA term | 5 years |
SECTION 8 — Direct Negotiation
Triggered after ≥2 failed CSPs with no outstanding dispute. Failure = no proposals received; only one bidder for RR/CR/DR; offers don’t meet TOR requirements.
SECTION 9 — Regulatory Support
ERC may impose fines/penalties on SO for non-compliance.
SECTION 10 — Protest Mechanism
- Reconsideration request to TPBAC within 3 days → TPBAC resolves within 7 days
- Protest to NGCP BOD within 7 days of denial → BOD resolves within 7 days → BOD decision final
- Court action via Rule 65 only after BOD finality
- Protests do not stay the CSP; must be resolved before award
SECTION 11 — Transitory Provision
Non-firm ASPAs remain valid but firm ASPAs prioritized for dispatch. Existing firm AS applications completed before effectivity and matching existing ERC-approved ASPA terms are excluded.
SECTIONS 12–14
Repealing clause (inconsistent rules repealed; DC2019-12-0018 unaffected provisions remain); Separability clause; Effectivity (15 days after newspaper publication + UPLC-ONAR filing).
Annex A — ASPA TOR Template (Key Items)
AS Types
RR (Regulating Reserve), CR (Contingency Reserve), DR (Dispatchable Reserve), Reactive Power Support (RPS ≠ RE program), Black Start (BS)
Minimum Unit Size
Luzon: 10 MW | Visayas: 5 MW | Mindanao: 5 MW (reviewed annually; aggregations allowed)
Payment Structure
- Capacity Payment (PhP/kW/h): Availability payment regardless of dispatch
- Incidental Energy Payment: Fixed Fee + Indexed Fee + ESS charging costs; offset against WESM revenues
- IE surplus/shortfall formula: Σ G × ([IE + Capacity payment offer] − WESM price); positive = SO pays shortfall; negative = SO uses surplus to offset next IE billing
- For Mindanao (pre-WESM): Full payment directly by SO
- Bid stacked in ascending order; pay-what-you-bid
Outage Allowance
Scheduled: 30 days/year | Forced: 15 days/year | No carry-over For outages beyond allowance: procure from Reserve Market or other ASPs at ERC-approved rates; failure = half Capacity Payment penalty
Bidder Qualifications
- ≤30% of any grid / ≤25% national installed capacity (EPIRA §45(a) caps)
- SO affiliates: explicitly barred
- Affiliated bidders: not disqualified against each other
- New ASPs: qualify on personnel competence + operational plan
Pages Written
- Created:
wiki/pages/concepts/ancillary-services.md - Updated:
wiki/pages/entities/ngcp.md— added source; expanded AS-CSP section with TPBAC/ASAPP details - Updated:
wiki/pages/concepts/reserve-market.md— added source; clarified contract vs. Reserve Market channels - Updated:
wiki/pages/concepts/competitive-selection-process.md— added AS-CSP vs. DU-CSP distinction table
Full text: Cleaned copy