CSP revamp eyes low-cost power
CSP refers to the process whereby a power supplier is chosen to supply the electric power requirements of a distribution utility through transparent and competitive bidding
Daily TribuneCSP refers to the process whereby a power supplier is chosen to supply the electric power requirements of a distribution utility through transparent and competitive bidding
Consumers can expect cheaper and more competitively priced power prices after the Energy Regulatory Commission or ERC released the amended guidelines of the government-mandated Competitive Selection Process or CSP.
The power watchdog said over the weekend that the new set of rules particularly ensured a streamlined and robust timeline evaluation of power procured through emergency power supply agreements or EPSA.
Likewise, it also outlined clear compliance parameters for situations that are exempted from the CSP requirement.
The Department of Energy or DoE DC2018-02-0003 entitled, "Adopting and Prescribing the Policy for the Competitive Selection Process in the Procurement by the Distribution Utilities of Power Supply Agreement for the Captive Market" governs the CSP.
The CSP refers to the process whereby a power supplier is chosen to supply the electric power requirements of a distribution utility through transparent and competitive bidding to secure supply. As per the DoE order, the ERC is required to develop and publish the CSP guidelines.
The CSP policy aims to promote the needs of the consumers as presented in the Distribution Development Plan and Power Supply Procurement Plans of the Distribution Utilities or DUs.
The DU, on the other hand, should embrace the principle of technology neutrality and consider the reliability of energy services in the least cost manner. It should also meet the demand of its Captive Market at any given time.
Salient provisions
As per the new guidelines, the ERC has developed detailed checklists and templates to help stakeholders comply with the new framework for power supply agreements or PSAs procured through CSP or exempted from it.
These resources outline pre-filing requirements and minimum standards for both Physical PSAs and Financial PSAs.
The maximum contract terms or duration for different kinds of PSAs are the following: up to one year for EPSAs, 10 years for Financial PSAs, 15 years for Physical PSAs, and 20 years for PSAs involving renewable energy or RE plants.
The time frame, according to the ERC, aligned with the covered periods under the Distribution Development Plans of DUs and in recognition of the RE targets set by the DoE.
On the other hand, the CSP Guidelines now specify that PSAs submitted for approval to the ERC will undergo a two-level review process.
