More businesses and even groups of households can now choose their own electricity supplier after the Energy Regulatory Commission (ERC) lowered the minimum electricity demand required to enter the competitive retail power market, expanding consumer choice beyond large industrial users.

The ERC reduced the contestability threshold starting Friday under the Retail Competition and Open Access (RCOA) program to 100 kilowatts (kW) from 500 kW to allow qualified medium-sized commercial establishments, schools, hospitals, office buildings, hotels, manufacturing facilities, and other electricity users to directly contract with their preferred Retail Electricity Supplier (RES).

The lower threshold also makes the Retail Aggregation Program (RAP) more accessible by allowing households and other smaller consumers who do not individually meet the 100-kW requirement to combine their electricity demand and, for the first time, collectively choose an electricity supplier.

The ERC said the move marks one of the biggest steps in implementing the Electric Power Industry Reform Act, broadening the customer base for retail electricity suppliers while giving more consumers access to competitive electricity offers.

The initial rollout will see 77 contestable customers make their first switch under the expanded RCOA program, including 58 in Luzon and 19 in the Visayas, bringing the total number of initial RCOA switches across all threshold levels to 96 customers.

Meanwhile, 11 Retail Aggregated Groups (RAGs), including household consumers, are scheduled for their first switch under RAP, all in Luzon, raising the total number of initial RAP switches to 40 RAGs.

ERC Chairperson and Chief Executive Officer Francis Saturnino C. Juan said the reform extends the benefits of competition to a much wider segment of electricity consumers.

“For the first time, residential communities are participating in the competitive retail market through aggregation, extending the power of choice beyond large corporations and industrial customers to ordinary households. 

This reform empowers consumers to seek electricity solutions that best fit their needs while encouraging suppliers to compete through better prices, innovative products, and improved customer service,” Juan said. 

Juan said expanding the retail market would also encourage suppliers to become more competitive while attracting further investment in the sector.

The ERC also recognized the Department of Energy, the Independent Electricity Market Operator of the Philippines, Retail Electricity Suppliers, distribution utilities, and other industry stakeholders for preparing the market for the expanded implementation.