100-kW threshold widens power choice

More Filipino businesses can now choose their electricity suppliers after the government lowered the contestability threshold to 100 kilowatts (kW), giving enterprises greater control over a major operating cost.

Implemented on 26 June, the new threshold marks Phase 4 of the Retail Competition and Open Access (RCOA) framework. Businesses with average monthly demand of 100 to 499 kW can directly choose a Retail Electricity Supplier (RES), while smaller firms can participate through the Retail Aggregation Program (RAP).

But the Energy Regulatory Commission (ERC) is urging businesses to do their due diligence before switching suppliers.

Atty. Chiara Angela Blanco, chief of the ERC’s Contestable Market Division, said businesses should verify that prospective suppliers are duly licensed and compare their offers through the ERC platform.

“From there, you can reach out to suppliers and compare their offers. You shouldn't just stick to one supplier at the start. You need to do your research and compare your options,” Blanco told the DAILY TRIBUNE.

Blanco said the ERC is also working on a platform that would allow businesses to compare indicative prices based on suppliers’ submissions.

For businesses considering a switch, however, price should not be the only consideration.

COREnergy President Francis del Val said firms should closely examine their contracts for additional charges and other conditions that could affect their actual electricity costs.

“Based on our experience, our advice would be to understand more than just the price. It's easy to look at the price, but what exactly is included in the contract?” Del Val said.

He said businesses should check for possible line rental fees, minimum monthly requirements and additional charges for exceeding contracted capacity.

Del Val also urged firms to understand where their suppliers source their electricity and determine whether they are dealing with a generator-retailer with actual generation assets or simply a trader.

“You need to understand whether the supplier is a generator-retailer – one that actually generates electricity and has physical electricity to sell because it operates power plants – rather than simply being a trader,” he said.

Smaller firms can join

Businesses that do not individually meet the 100-kW threshold can pool their demand through RAP and participate in the competitive market collectively.

Blanco said qualified customers should receive a notification on their monthly electricity bills.

“If you meet or exceed 100 kilowatts, you should see a notification on your monthly bill stating that you are already qualified,” she said.

The lower threshold gives more enterprises an opportunity to treat electricity as a cost that can be managed strategically rather than simply as a fixed overhead.

For Del Val, switching suppliers should also be about finding a long-term partner that can help businesses navigate the electricity market.

“And third, it's not just about changing your electricity supplier. It's about building a relationship with someone who understands what is a relatively complex industry,” he said.

COREnergy currently serves 88 businesses across 144 accounts, representing 90.8 MW in peak capacity, according to the company.

Del Val said the company would continue guiding newly contestable businesses through the eligibility and switching process.

“Our ultimate goal is simple: to ensure no Philippine business gets left behind,” he said.