THE Energy Regulatory Commission (ERC) outlined its priorities for a resilient and competitive Philippine energy sector, highlighting oversight of a P3.19 trillion industry.
During the American Chamber of Commerce (AmCham) Annual 9th Energy Forum held last week, the agency shared regulatory measures and priorities during the forum, emphasizing the need for regulation to keep pace with the evolving needs of the country’s energy sector.
‘The ERC oversees an industry valued at approximately P4.19 trillion, covering generation, transmission, distribution, and supply,’ ERC Market Operations Service (MOS) Director Sharon O. Montañer said. She added that the ERC strategy focuses on strengthening grid reliability, expanding consumer choice through 100-kilowatt (kW) retain competition open access (RCOA), promoting investment, and facilitating the energy transition.
To strengthen power system reliability, the ERC is advancing measures such as the proposed Philippine Grid Code 2026, transmission development and the timely connection of new generation resources, strengthened reliability performance rules, and renewable energy (RE) integration in off-grid areas.
On competition, the ERC is expanding opportunities for consumers to participate in the competitive electricity market through the implementation of the 100-kiW contestability threshold under RCOA and the Retail Aggregation Program (RAP).
The commission is likewise pursuing reforms to promote a more predictable investment environment, including the rationalized rules for setting distribution wheeling rates and the streamlining of regulatory processes, while advancing reforms in distributed energy resources and behind-the-meter technologies to facilitate greater consumer participation in the energy transition.
Montañer emphasized that these initiatives are interconnected. They form part of the ERC’s broader objective of building an electricity sector that supports economic growth, promotes competition, attracts investment, and remains adaptable as the country transitions toward a cleaner and more resilient energy future.
‘Resilience is not simply the ability to recover from disruption. Resilience is the ability to emerge from disruption with a stronger system than before,’ Montañer said.
The ERC’s urgent tasks were broadened with the recent State of the Nation Address (Sona), where President Ferdinand Marcos Jr. directed the removal of the system loss charge from the electricity that users are billed for, as well as the value added tax imposed on it.
The ERC has proposed a draft resolution to remove the 12-percent VAT on system loss charges, aiming to lower electricity bills for consumers.
It also required all distribution utilities to submit their system loss data from 2021 to 2025 and every year thereafter. In particular, the data required for submission include the generation purchased cost, transmission cost, energy output, energy input, sub-transmission and substation, feeder technical loss, non-technical loss, and kilowatt hour (kWh) shouldered by the DU in excess of the feeder loss cap, if any.