DOE seeks suspension of 40 power plants amid Visayas strain

By Francis Allan L. Angelo

About 40 power generation plants may face suspension orders for ignoring government warnings, even as tight electricity supply persists across the Visayas, the country’s energy chief said.

The Department of Energy is preparing to recommend suspensions to the Energy Regulatory Commission, targeting delinquent operators that did not respond to earlier administrative warnings over unannounced service disruptions and capacity shortfalls.

“We’ve given them a warning. And we are now in the process of recommending suspension to ERC (Energy Regulatory Commission),” Energy Secretary Sharon Garin said in an interview over the weekend, when asked about possible sanctions or penalties on companies that failed to respond to the agency’s show-cause orders.

Garin did not name the operators, but said most run small diesel-fired plants.

About 10 of the generation assets marked for suspension are no longer operational, she said, effectively removing capacity from the grid while still complicating grid management and compliance accounting.

Several major generating units have gone offline at the same time, putting the country’s main grids, particularly the Visayas, under strain.

“We’ll wait for the process. But we’ve been meeting since last week on what to do. So, the decision is to send it to ERC for proper action,” Garin said.

The DOE issued 203 show-cause orders to power generation companies nationwide in July for failing to submit mandatory self-assessment reports, the forms the agency uses to monitor plant reliability and outages.

Of that total, 174 went to on-grid generation facilities and 29 to off-grid operators.

The orders also required power firms to account for forced outages, reduced generation, and failures to deliver the capacities they had committed to supply to the grid.

Operators were told to submit formal legal justifications for missing mandated performance and reporting schedules, or face penalties.

Compliance across the sector was uneven. Only 37 on-grid facilities met the filing conditions set out in the notices, while five operators asked regulators for deadline extensions.

A total of 114 on-grid generation facilities did not respond, triggering the current phase of punitive regulatory action.

The enforcement push builds on a sweeping regulatory audit conducted under Department Circular No. DC2026-02-0006, the accountability framework that requires power producers to operate only with fully active permits, clearances, and operational certifications.

Last week, the DOE issued a draft department circular proposing supplemental guidelines for implementing and enforcing that generation company accountability policy, and is now seeking public comments on the text.

Under the proposed rules, a generation company found to have committed a prima facie violation may receive a show-cause order and be placed under strict compliance monitoring.

A first offense would draw a stern warning and require compliance with the DOE’s monitoring requirements.

Failure to submit required reports or documents within the prescribed period may constitute a second or third offense.

On a second offense, the case would be referred to the ERC for appropriate action, and the company could face suspension of its DOE-issued certificate of endorsement.

A third offense would carry heavier consequences, including blacklisting from DOE-administered programs.

Repeat offenders could also be endorsed to the ERC for the revocation of their certificate of compliance or other authorizations issued by the commission.

The DOE also has the power to levy administrative fines and bar non-compliant firms from competitive selection processes, power auctions, and government award programs.

“It (circular) seeks to ensure the timely submission of complete, accurate and transparent reports, promote due process and regulatory consistency in enforcing reportorial obligations and support the DOE’s mandate to uphold the reliability, adequacy, security and resilience of the electric power industry,” the DOE said.

The Visayas has long contended with thin power supply, with yellow alerts raised on the grid almost every day and red alerts during periods when available capacity is no longer enough to meet demand.

A yellow alert is issued when operating reserves fall below the required level, while a red alert signals a supply deficiency that can force rotating brownouts.

The National Grid Corp. of the Philippines earlier said the region’s electricity supply may receive a boost by the end of August, as two large coal plants return to commercial operations.

The DOE has framed the crackdown as an effort to stabilize persistent grid strain in both the Visayas and Mindanao, the two island grids most exposed to the loss of a single large unit.

To bridge the generation gaps created by aging fossil-fuel infrastructure, particularly across island grids, the government is accelerating a shift toward renewable alternatives.

Authorities are structuring a Green Energy Auction specifically for areas managed by the National Power Corp.

The program aims to replace high-cost diesel units with renewable capacity paired with battery energy storage systems, beginning with an initial rollout across 20 off-grid islands.

Consultations with private sector energy developers, local government units, and regional distribution partners are continuing to establish the final framework terms.