THE Energy Regulatory Commission (ERC) said it issued a show-cause order to South Premiere Power Corp. (SPPC), the operator of the Ilijan gas-fired power plant in Batangas, to explain the plant’s downtime in June 2022, in aid of a possible investigation into alleged anti-competitive behavior.
In an order dated July 24, the ERC said it evaluated the assessment report submitted by the Philippine Electricity Market Corp. (PEMC), which found that the 1,200-megawatt power plant was placed on “open breaker status” for 21 days in June 2022.
This means the facility was not supplying the Wholesale Electricity Spot Market (WESM), the trading floor for electricity.
The ERC noted that the incident coincided with a market price increase averaging 30% month on month and the issuance of multiple yellow and red alerts due to power supply deficiencies.
Under Section 45 of the Republic Act No. 9136 or the Electric Power Industry Reform Act (EPIRA) of 2001, anti-competitive behavior covers cross-subsidization, price manipulation, or other unfair trade practices detrimental to the encouragement and protection of contestable markets.
The ERC is tasked with monitoring and penalizing any abuse of market power or anti-competitive or discriminatory behavior by any participant in the electric power industry.
The ERC also issued a notice to explain to the PEMC, the governance arm of the WESM, “for actions surrounding the Ilijan incident.”
The PEMC notified the ERC on Sept. 13, 2022 of a possible anti-competitive act committed by SPPC, but later recalled as the notice “pending finalization.” The ERC said that it was only in May last year that PEMC submitted its compliance with its written requests.
Following PEMC’s recommendation to endorse to the ERC a notice of possible anti-competitive behavior for the conduct of an investigation, the commission directed the plant operator to submit its verified explanation within 15 days from receipt on why it should not face administrative sanctions and penalties for potential violations under EPIRA.
The SPPC was then wholly owned by San Miguel Global Power Holdings Corp., the power generation arm of conglomerate San Miguel Corp. (SMC). It has since given up 67% to units of the Meralco and Aboitiz groups.
SMC was asked to comment but had yet to reply at the deadline. — Sheldeen Joy Talavera