ERC Pushes EPIRA Overhaul to Cut Electricity Costs

The Energy Regulatory Commission (ERC) is advocating for amendments to the Electric Power Industry Reform Act (EPIRA), citing the potential to lower electricity prices and address longstanding issues in the power industry.

“The amendments in EPIRA will definitely help,” ERC Chairperson and CEO Monalisa Dimalanta said, expressing optimism about the reforms’ impact on high electricity costs.

EPIRA, enacted in 2001, restructured the power industry into four sectors—generation, transmission, distribution, and supply—to encourage competition and efficiency. Before EPIRA, the state-run National Power Corporation (Napocor) controlled all facets of the power sector.

More than two decades later, President Ferdinand R. Marcos Jr. has tasked Congress with reviewing EPIRA to address outdated provisions and align the law with the current needs of the energy sector.

Dimalanta stressed the urgency of overhauling the ERC itself, describing its current structure as inadequate for the complexity of today’s power market.

“The ERC is currently structured in the same way the ERB (Energy Regulation Board), its predecessor, was structured. The industry has evolved significantly from the pre-EPIRA structure,” Dimalanta said.

Unlike the centralized Napocor era, the sector now includes a single transmission operator, about 300 generation companies, and over 140 distribution utilities.

“The structure of ERC is not suited to deal with these many stakeholders, so we really need legislation to allow us that flexibility to restructure accordingly,” Dimalanta said.

Restructuring the ERC could help streamline regulatory processes, reducing delays and allowing the agency to better meet the demands of the growing power industry.

“This will definitely improve our chances of getting more affordable prices in our power system,” she said.

The ERC is also seeking emergency powers under EPIRA to enable the commission to act quickly during calamities. Under the current rules, the presence of at least three members is required to form a quorum, with the majority vote of two members needed to pass decisions.

“Government agencies, including the ERC, need to respond more quickly during calamities, and it’s challenging for the ERC to take action as a commission,” Dimalanta said. “The system is slow when all five members need to meet to address a situation.”

EPIRA mandates the ERC to protect consumer interests, foster competition, develop markets, and penalize market abuse. The ERC also oversees the implementation of EPIRA’s rules and regulations.

Proposed reforms aim to align the agency’s mandate with industry changes while ensuring it continues to advocate for consumer protection and affordable electricity.