IT is seldom realized, and often not pointed out, that one of the key snags that hamper the nation’s march towards economic recovery is the presence of too many regulators who are being ignored by the entities that they regulate.
Take the case of energy. Recently, the Energy Regulatory Commission (ERC) directed the National Grid Corp. of the Philippines (NGCP) to explain why it should not be penalized for its failure to comply with policies designed to ensure enough power reserves when power plant capacities decline.
It is the government’s job to ensure that all solutions are available to support the uninterrupted transmission of electricity from power plants to end users so that brownouts and longer periods without electricity are avoided. While the government may not be remiss in issuing reminders and even warnings on power providers, long power outages still happen, even if the Philippines has one of the highest electricity rates in the Asian region.
‘It’s time to use the iron gloves and make these powerful tycoons in the power sector toe the line.’
The regulatory agency wanted NGCP to explain why it failed to obtain the DOE’s approval of its Ancillary Service Agreement Procurement Plan (ASAPP) and the terms of reference of the Ancillary Service Competitive Selection Process (CSP), as well as complete the competitive bidding within six months from the effectivity of the DOE circular.
The ERC’s move compelling the NGCP to comply with government directives came after the provinces of Nueva Ecija, Aurora, Pampanga, and Zambales experienced power outages last week.
On Sept. 12, the NGCP raised red and yellow alerts in the Luzon grid lasting several hours as seven power plants went on forced outages and three others reduced their capacities.
A yellow alert is placed when power reserves fall below ideal levels while a red alert is declared due to insufficient electricity, which may result in rotating power interruptions.
Simultaneous maintenance of power plants and tripping of transmission lines also exacerbate the problem.
In the past, regulators like the ERC and the DOE have been using kid gloves in dealing with the power producers and distributors, leading to inefficiency and eliciting criticisms from the public.
It’s time to use the iron gloves and make these powerful tycoons in the power sector toe the line.
