Electricity market operator checks for anti-competitive behavior among power corps

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Metro Manila (CNN Philippines, April 25) — The Philippine Electricity Market Corporation (PEMC) said it is looking into the possibility that power corporations worked together to minimize competition as power reserves have remained low for weeks due to the forced shutdowns of power plants.

PEMC Chief Governance Officer Rauf Tan told the Senate Energy committee that they are checking to see whether the bidding behaviors of power companies changed, which could indicate that there was collusion among them to jack up power rates to their benefit.

“Doon ho natin malalaman kung may kumita ba, mayroon bang masiyadong kumita, at kung may kumita ba talaga at paano nila kinita ito,” Tan said Thursday.

[Translation: That is where we would see if anyone profited, if anyone profited too much and if anyone profited at all and how they profited.]

However, Tan said this data would only be available during settlement, which would only happen at the end of the trading month or on April 26.

He said they would submit whatever they could gather to the Energy Regulatory Commission and the Department of Energy (DOE) which would pursue a probe if they see any indications of anti-competitive behavior.

For now, the energy regulator and the Philippine Competition Commission (PCC), which is also looking into possible anti-competitive behavior among power companies, said there is not enough evidence pointing to unfair market practices.

Power companies denied that they engaged in anti-competitive behavior.

“I honestly believe that nobody is trying to cheat the market,” Semirara Mining and Power Corporation CEO Isidro Consunji told the Senate panel. “There are many issues involved that we probably have to address properly.”

The DOE attributed the power shortage to the unexpected shutdowns of power plants. It said that had these plants remained online, there would have been enough power reserves, thwarting power interruptions.

Aside from having caused rotational power outages in some areas, including Metro Manila, the DOE also said the shutdowns may cause power rates to spike as power generators and distribution utilities may pass to consumers the higher cost of electricity that they buy.

Senate Energy committee chair Sherwin “Win” Gatchalian pointed out that most of the power plant shutdowns were attributed to breakdowns of boilers, which is used to generate power.

“This is a recurring problem that we see not only during the summer but also throughout the year,” Gatchalian said, adding that power generators should find ways to prevent this from repeatedly happening.

But Philippine Independent Power Producers Association President Anne Estorco Macias said power plant outages could not be avoided.

“Forced outages are natural and inevitable occurrence in all types of technology. A forced outage is an engineering issue, something that is not foreseen or cannot be reasonably predicted,” Macias said.

The Senate Energy panel conducted a probe on the country’s power woes as the National Grid Corporation of the Philippines placed the Luzon power grid on yellow and red alert, which means that there is insufficient power supply. This caused power interruptions in some areas.

Alerts have been hoisted over the Luzon grid for three weeks.