EPIRA to lower power rates in 3 years - expert

MANILA, Philippines - Energy expert Alan Ortiz believes that the promise of the Electric Power Industry Reform Act (EPIRA) to bring down power rates will be realized in two to three years time.

Ortiz, who is now the president of San Miguel Global Power Holdings Corp., said that power rates would go down by 25 percent by 2013.

“It’s been 10 years since the enactment of EPIRA. When we wrote the EPIRA, it would take 10 years to complete all the requirements. And when you have open access and retail competition, historically, the rates go down by 25 percent. Within a couple of years from the completion, historically in other parts of the world rates have come down by 25 percent. So it’s an important threshold we have to watch,” he said.

He also took note of the efforts of the present administration to achive this EPIRA promise.

Ortiz’s optimism, however, hinges on the ability of the grid to accommodate these new capacities. “At the same time, the grid has to be in place to be able to accommodate the new capacities to come in,” he said. Ortiz said open access and retail competition will also contribute in bringing down power rates.

“In three years time, the rates should come down particularly when all these capacities become available.

Open Access and Retail Competition (OARC) will introduce competition in the retail supply segment of the electric power industry.

Under open access, contestable customers may now choose their electricity service provider while Meralco will continue to be the networks and metering service provider.

This means that electricity end-users with an average monthly peak demand of one megawatt for the 12 months preceding December 26, 2011 will now have a choice from whom to procure their electricity service.