UP CIDS Sustainable Energy Program Hosts a Public Forum on Competitive Selection Process for Energy Supply
In light of the release of DOE Department Circular DC2015-06-0008 “Mandating All Distribution Utilities to Undergo Competitive Selection Process (CSP) in Securing Power Supply Agreements (PSA)” as well as the release of the initial Implementing Guidelines by the DOE and ERC for the said circular, the UP CIDS, under its Sustainable Energy Program (SEP), held a Public Forum last September 29, 2015.
Dr. Mili-Ann Tamayao, a professor of the College of Engineering in UP Diliman and also the Program Coordinator for the UP CIDS SEP, presented to an audience the output from an RTD on the Circular as well as the Initial Guidelines released by the DOE and ERC.
Dr. Tamayao presenting the timeline from the release of the CSP Circular up to the Deadline for comments on the Initial Guidelines.
She discussed the premise, objectives, and features of the Circular. It mandates all distribution utilities to purchase their power demands through a competitive selection process to be conducted by a Third Party recognized by the DOE, ERC, or NEA. In general, the following were the comments from the RTD:
1. The idea of a CSP is a promising solution to the achievement of efficient energy generation adequacy.
2. The provisions for competitive selection process of a Third Party is commendable.
3. However, the excessive control of the Third Party over CSP design and implementation as well as PSA awarding and execution must be addressed. To ensure protection of public interest, design of CSP as well as PSA must be done by ERC-DOE and must be made transparent to the public.
4. Thoughtful and transparent design of CSP and PSA must incorporate variation of market characteristics across regions in the country.
5. CSP design must take into consideration the technological changes (e.g., renewable energy systems) aimed at moving towards sustainable energy systems (e.g., renewable energy systems).
Rep. Reynaldo Umali, the House Chair on the Committee on Energy, gave his reaction to Dr. Tamayao’s presentation by first commenting on the CSP Circular and its guidelines. He mentioned the objectives to be laudable but that the real challenge is in operationalizing what is proposed in the Circular. He said that he was unsure that, given the current situation of the Philippines with a 16,000MW supply and a 15,000MW demand, it is unclear if cheaper rates can be achieved with a very small difference between the supply and demand of power. He also cited the energy mix of the country as being more favorable to coal and which may have an influence on how the CSP is going to be conducted.
Regarding Dr. Tamayao’s presentation, he is also concerned with the jurisdiction given to the Third Party as well as the given deadline for comments on the Implementing Guidelines being October 1, 2015. He expressed his commitment on a deeper analysis of the CSP Implementing Guidelines instead of rushing things.
During the open forum, some questions concerning the timeline of the DOE and ERC regarding the implementation of the Circular and its IG, the Third Party’s role in the overall implementation of it, and how renewable energy technologies were to be accounted for in the CSP were raised. The CSP IG is not clear on how some of these concerns were to be addressed. These questions were taken into account and have been included in the final statement of the UP CIDS which was forwarded to the DOE and ERC for their deliberation on the CSP IG.
You can download the full statement here: http://sustainableenergy.cids.up.edu.ph/2015/06/30/up-cids-releases-statement-on-the-doe-department-circular-dc2015-06-0008/