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CONSUMER watchdog National Association of Electricity
Consumers for Reforms (Nasecore) urged the government
that standards and sanctions for least cost supply be
established and economic dispatch institutionalized.
In its position paper, Nasecore said the landmark
institutions in the Electric Power Industry Reform Act (Epira)
that need to be strengthened, if consumer interest is to
be truly protected are least cost supply and economic
dispatch.
“If these consumer institutions are properly implemented and
meticulously observed, open access and retail
competition will only be enhanced by consumer
empowerment, to be invoked and exercised when these two
institutions fail,” said the consumer group.
Nasecore noted that Section 23 of the Epira states that the
obligation of the distribution utility is to provide
electricity to its captive customers in the least cost.
And by this provision, procuring expensive electricity
from a sister company should be circumscribed and the
captive customers spared the burden of unreasonable
costs, the group added.
The spirit and intent of Epira is clear, according to
Nasecore. If this is now not being implemented in that
light, then the Joint Congressional Power Commission
should go back to the law and craft this spirit and
intent into the language of that law, making that intent
unmistakable to the regulator, the utility, the courts,
the executive, and most importantly, the consumers.
Nasecore further said the Epira mandates the dispatch of
plants based on an economic merit order, with the most
efficient, the least expensive, or economic to be
dispatched first.
Under a regime of economic dispatch, Nasecore said that to be
implemented by the system operator under close
supervision of the regulator, the captive customer is
less susceptible to price manipulation.
With these two institutions firmly in place, Nasecore noted
that the household consumers and captive customers,
including industrial and commercial costumers, will not
have to seek the best price in an open electricity
market, because the faithful observance of these
principles and practice should already yield the best
price.
“There will be no serious takers of the generation assets of
the National Power Corp. that are up for bids for as
long as access to the market by generation companies is
curtailed, lop-sided supply contracts are honored, and
the rules of competition are unclear,” said Nasecore.
The consumer group added that no prospective investor will
put his money in a plant without a contract, given the
present conditions, while an electricity industry that
is unfettered by sweetheart deals, and allows true
competition by making the entire market contestable to
generation companies, will draw prospective investors.
Nasecore urged the Joint Congressional Power Commission to
recommend the necessary remedial legislation or
executive measures that will immediately address the
inherent weaknesses in the present law, particularly the
fourth condition on open access and retail competition
under Section 31 of the Epira. |
