Lower threshold expands power competition

More businesses will soon be able to choose their own power suppliers after the Energy Regulatory Commission (ERC) approved a landmark ruling lowering the eligibility threshold for retail competition in the electricity market.

The power watchdog said Tuesday that the new rule reduces the requirement for participation in the Retail Competition and Open Access (RCOA) and Retail Aggregation Program (RAP) from 500 kilowatts (kW) to 100 kW in average monthly peak demand, effective 26 June 2026. 

Once implemented, the expansion will allow more medium-sized enterprises and institutions to directly source electricity or aggregate their demand under the RAP.

“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 Chairperson and CEO Atty. Francis Saturnino C. Juan said.

The ERC said the move fulfills a statutory mandate under the Electric Power Industry Reform Act and will be implemented gradually to ensure market readiness. 

Distribution utilities (DUs) and retail metering service providers are given eight months to procure and install compliant metering facilities, addressing concerns raised during public consultations in Luzon, Visayas, and Mindanao over metering infrastructure availability, procurement timelines, and potential stranded capacities from existing power supply agreements.

To support the transition, the ERC has also issued updated rules on the implementation of Advanced Metering Infrastructure by DUs and ERC-authorized entities, guiding the nationwide rollout of smart metering systems. 

The commission will coordinate with the Department of Energy and the Independent Electricity Market Operator of the Philippines to ensure billing, registration, and settlement systems are ready for the expanded number of retail customers, with the market operator already beginning internal preparations.

To further guide the market shift, the ERC will release a Comprehensive Roadmap outlining the phased implementation of RCOA, RAP, and the Green Energy Option Program, ultimately extending retail access to households.

Currently, more than 2,300 customers are enrolled under RCOA, while 37 retail aggregated groups account for nearly 31 megawatts of demand.