RCOA Commercial Implementation Starts Today

26 June 2013

(Taguig City) – End-users with electricity demand of one megawatt (1000 kW) or more may now opt to avail power from their chosen supplier of electricity as the commercial implementation of the Retail Competition and Open Access (RCOA) takes effect today.

RCOA was declared last 26 December 2012 after all the preconditions contained in Republic Act 9136 or the Electric Power Industry Reform Act of 2001 (EPIRA) have been met. EPIRA provides for the restructuring framework of the electric power industry towards RCOA and aims to ensure transparent and reasonable prices of electricity in a regime of free and fair competition. Since then, a transition period for all stakeholders has been set in place to prepare the industry for the changes brought about by RCOA.

With RCOA, “contestable customers” or those consuming one MW and up with a duly issued Certificate of Contestability by the Energy Regulatory Commission (ERC) now have several options in securing power supply for their needs: directly contract power either through Retail Electricity Supplier (RES) or the Local RES. The RES are entities licensed by the ERC to sell electricity to the Contestable Customers.

To provide adequate time for Contestable Customers who failed to negotiate for a Retail Supply Contract with a RES or Local RES, the Department of Energy (DOE) and ERC jointly issued the policy for the existing distribution utilities to continue service these customers. Moreover, both the DOE and ERC have collaborated to avoid the disconnection of Contestable Customers or be served by the Supplier of Last Resort (SOLR).  The SOLR may source electricity to be supplied to the Contestable Customers through the WESM or any available source of energy supply.

Electricity end-users consuming 750 kW and below will remain to be the “Captive Customers” of their respective distribution utilities.  However, based on EPIRA, two years after the implementation of RCOA, the threshold level will be reduced to 750 kW. Further reductions on the threshold of contestability will be based on the market assessment of the ERC with the goal in the coming years that the required power consumption level thresholds reaches the household level.

“We would like to thank all the energy stakeholders for their utmost support in making RCOA a reality.  We hope that with this mechanism, people will feel more empowered in terms of access to electricity so they can make better energy choices,” DOE Secretary Carlos Jericho Petilla said. 

The DOE assures the public of its continuous monitoring of the developments in the RCOA implementation and will issue the necessary policies to ensure greater benefits to all stakeholders and to the industry as whole.