Oil Unbundling Circular

DOE STATEMENT ON THE COURT OF APPEALS' RULING UPHOLDING THE TAGUIG RTC'S ISSUANCE OF A WRIT OF PRELIMINARY INJUNCTION ON THE IMPLEMENTATION OF THE OIL UNBUNDLING CIRCULAR

Although the Court of Appeals' (CA) Decision on the matter was released through its website, the Department of Energy (DOE), through its counsel the Office of the Solicitor General, has yet to formally receive a copy of the Ruling. Once formally received, the DOE intends to seek a reconsideration of the Decision, and raise the issue to the Supreme Court, if necessary.

The DOE would like to emphasize that the CA ruled only on the issue of the validity of the trial court's issuance of a writ of preliminary injunction. 

While the writ has prevented the DOE from implementing Department Circular (DC) DC2019-05-0008 on the unbundling of oil prices during the course of the case in the trial court, the CA Decision did not rule on the validity or invalidity of the DC.

The DOE considers the Circular vital as it believes in the objective of the law for the transparency of oil prices, at least to the government, in order to formulate better and more responsive oil industry policies. The DOE issued the Circular to help strengthen the agency's capability to monitor oil prices more effectively.

Moreover, the cases filed by the oil companies to nullify DC2019-05-0008 were based on the wrong notion that the supposed trade secrets they are being obligated to submit to the DOE wiill be divulged to the public. Time and again, the DOE has been stressing that all confidential information shall be kept strictly confidential.

The DOE maintains that the unbundling of oil prices would foster greater market transparency by establishing the trends in the prices of oil and finished petroleum products. This, in turn, would help ensure a level playing field within the oil industry, while upholding the best interests of consumers.

ERC Calls for Comments on the Proposed New RCOA Timeline

PRESS STATEMENT: ERC Calls for Comments on the Proposed New RCOA Timeline

The Energy Regulatory Commission (ERC), in a Notice issued pertinent to ERC Case No. 2020-002 RM in re:  Draft Resolution Prescribing the New Timeline for the Implementation of Retail Competition and Open Access (RCOA), sought comments from all interested parties on the proposed Resolution until 12 October 2020.  The first draft of the proposed Resolution aims to provide guidance on the implementation of the RCOA scheme, more particularly the updated timeline for the full implementation thereof.

"We are requesting all interested parties to submit their comments or inputs on the Draft Resolution Prescribing the New Timeline for the Implementation of Retail Competition and Open Access (RCOA) to ensure that we leave no stone unturned and ensure the seamless implementation of the RCOA", said ERC Chairperson and CEO Agnes VST Devanadera. 

At present, RCOA is implemented in the Luzon and Visayas grids for the Phase I (1MW & up) and Phase II (750kW-999kW) contestable customers, on a voluntary basis.  The ERC's draft Resolution prescribes the time frames for the lowering of the threshold or the average monthly peak demand to cover end-users, as follows:  

                           Threshold                             Level Effectivity

Phase III              500 kW to 749 kW               Feb. 26, 2021

Phase IV              100 kW to 499 kW               Jan. 26, 2022

Phase V               10 kW to 99 kW                   Jan. 26, 2023

End-users who meets the threshold level shall be allowed to contract with any licensed/authorized suppliers of electricity on a voluntary basis.  

The RCOA shall be effective in grids where the Wholesale Electricity Spot Market (WESM) is operational.  All suppliers of electricity shall be licensed or authorized by the ERC to supply in the Competitive Retail Electricity Market (CREM).  

Under the RCOA environment, the qualified Contestable Customer will be notified by the Network Service Providers of the former's ability or option to choose his electric service provider and may switch to his preferred Retail Electricity Supplier (RES).  Meanwhile, the Meter Service Provider (MSP) shall install the meter facilities that will measure the energy use and demand of the qualified contestable customer.  The MSP is the person or entity authorized by the ERC to provide metering services in the CREM.

"The benefits of the RCOA scheme will soon come to fruition despite the temporary setback that came up against its implementation.  The envisioned competition in the retail level of the supply sector will soon be a reality and the consuming public will be the beneficiaries of the RCOA as they can opt to choose the electricity provider that offers the most competitive price", Chair Devanadera added.