Lifting TRO on RCOA may affect electronics industry

Lifting TRO on RCOA will affect electronics industry

The semiconductor and electronics players have called on the Department of Energy (DOE)  to give a clear energy security roadmap for the country, as it cautioned against moves to lift restraining order on RCOA, saying it will be detrimental to the industry.

A roadmap will “allow the industry to effectively compete with neighboring countries for a share of the global market,” Semiconductor and Electronics Industries in the Philippines, Inc. (SEIPI) President Dan Lachica said.

In the same manner, they also expressed concern at how the industry will be affected should the Supreme Court lift the temporary restraining order (TRO) on the mandatory contestability under the Retail Competition and Open Access (RCOA) scheme.

“We are concerned that once the TRO on RCOA is lifted, distribution utilities (DU) will no longer have their own RES (retail electricity supplier),” Lachica said.

The omnibus motion, which the Department of Energy and Energy Regulatory Commission want to lift, seeks to know if the two can lower the threshold of RCOA’s mandatory contestability to 750 kW on a voluntary basis and if the ERC can issue and RES licenses.

“We have high load factor members with existing RES contracts with DUs. What will happen to these contracts if the TRO is lifted?” Lachica adds.

“We believe that we should allow the market to drive the market condition in defining electricity pricing,” Lachica said. “Power rates were pegged at 4.50 per kWh previously, but owing to prevailing market condition, we are now seeing it at 3.50/kwh. It shows that voluntary competition under RCOA is working. The [electronics/semicon] industry’s position is to maintain that condition.”

In February this year, the SC issued a TRO on the RCOA which mandates large power consumers to migrate to the contestable market.

Under the RCOA scheme, end-users with at least one megawatt (MW) usage were supposed to shift in February, while those with at least 750-kw demand were given until June to migrate.

The RCOA, which is under the Electric Power Industry Reform Act of 2001 (RA 9136), will give contestable customers the freedom to choose their power supplier. The scheme, however, has yet to be implemented.