3 days ago
Electricity consumer group seeks overhaul of CSP regime
Consumer advocacy group National Association of Electricity Consumers for Reforms (Nasecore) is seeking an overhaul of the competitive selection process (CSP) scheme that governs electricity rate-setting.
In a statement on Tuesday, Nasecore, citing a letter to Department of Energy (DOE) officer-in-charge Secretary Sharon Garin dated June 3, said it proposed that the DOE publicly declare the current CSP framework a 'policy failure' and recognize its inability to ensure transparent, competitive, and cost-effective procurement.
The CSP refers to the procurement mechanism, mandated by the DOE, wherein a distribution utility—such as Meralco—procures supply from a generation company through competitive bidding to get the least cost of power for the consuming public.
With this, Nasecore is proposing a 'comprehensive overhaul' of the CSP policy, starting with a DOE-led, multi-stakeholder review.
GMA News Online reached out to the DOE for comment. The story will be updated once a response is received.
The group said the CSP scheme 'clearly failed to uphold its core objectives of transparency, fair competition, and least-cost power supply procurement.'
This, as Nasecore said it 'continued to monitor rates and power supply deals by Meralco and found that 'the CSP mechanism has not delivered meaningful market competition.'
'On the contrary, it has largely preserved the dominance of incumbent and affiliated generation companies, especially in the franchise area of Meralco. No new independent or reliable power suppliers have been introduced into Meralco's generation mix in the past decade,' the group said.
Nasecore is urging the DOE to conduct a full audit of Meralco's PSAs from 2019 to 2024 to assess adherence to CSP rules and procurement guidelines.
Sought for comment, Meralco said that a a 'highly regulated electric distribution utility,' it strictly complies with the policies and rules of the DOE and the Energy Regulatory Commission (ERC) related to the procurement of power supply for its captive customers.
'Meralco also regularly updates and submits its Power Supply Procurement Plans (PSPPs) for DOE approval and conducts CSPs in accordance with these approved plans,' it said.
'All resulting PSAs undergo ERC review, including regulatory evaluation and public hearings, to ensure transparency, fairness, and compliance with established guidelines,' it added.
Meralco said it remains fully committed to delivering reliable and least-cost power to its customers while adhering to the legal and regulatory frameworks governing the CSP and the energy sector in general.
The consumer advocacy group called for full public disclosure of CSP documents, including bid criteria, evaluations, and awarded contracts.
Nasecore said it also furnished the three-page letter to President Ferdinand Marcos Jr., Executive Secretary Lucas Bersamin, Senate President Francis Chiz Escudero, and House Speaker Ferdinand Martin Romualdez. — BM, GMA Integrated News
