RCOA threshold reduced to 100 kW

MANILA, Philippines — The Energy Regulatory Commission (ERC) has lowered the eligibility threshold in the retail electricity market, opening the door for more consumers to select their preferred power supplier.

Starting June 26 next year, the minimum threshold to participate in the retail competition and open access (RCOA) program will be down to 100 kilowatts from the current 500 kW.

The landmark reform will also apply to the retail aggregation program (RAP), a scheme that allows multiple power end-users to consolidate their demand and gain direct access to choosing their electricity provider.

This new threshold mirrors the level currently implemented under the green energy option program (GEOP), which enables consumers with a monthly peak demand of 100 kW to directly contract renewable energy supply.

“By expanding retail access to more end-users, we are promoting genuine consumer choice and driving competition that can lead to better prices, improved service quality and innovation in the power sector,” ERC chairman and CEO Francis Saturnino Juan said.

According to the ERC, the eight-month transition period before the reform takes effect gives distribution utilities and retail metering service providers enough time to procure and install compliant metering facilities.

The phased approach also responds to key concerns raised by stakeholders, particularly on the readiness of the advanced metering infrastructure and possible stranded capacities from existing power deals of distribution utilities.

“Lowering the contestability threshold to 100 kW and implementing it in a deliberate and orderly fashion marks a significant advancement in unlocking the full potential of open access and consumer choice in the Philippines,” Juan said.

“This move underscores our commitment to fostering a fair, competitive and transparent electricity market that delivers enduring benefits to Filipino consumers,” he said.

To guide the transition, the ERC intends to publish a roadmap outlining the phased implementation of customer choice programs such as RCOA, RAP and GEOP, leading up to household participation.

The adoption of a new threshold is consistent with the objectives of the Electric Power Industry Reform Act, which seeks to promote competition and ensure consumer choice with greater participation in the retail market.

Currently, over 2,300 customers have switched to the retail electricity market, according to the ERC.