With new entrant Independent Power Producer Administrators (IPPAs) making their own lapses at times, the Energy Regulatory Commission (ERC) has issued revised guidelines that shall cover them in the issuance of certificates of compliance (CoCs) for generation facilities.

The CoCs direct power generation facilities to comply with all operational, technical and financial standards set forth under relevant policies, such as the Philippine Grid Code PGC), Philippine Distribution Code (PDC) and the Wholesale Electricity SpotMarket (WESM) Rules, among others.

In the revised guidelines, the regulator stated that “in the case of facilities covered by the National Power Corporation-IPPs, the ERC shall consider the COCs issued to the owners of the said facilities as deemed issued also to the IPPAs for purposes of enforcement of and compliance to the subject Revised Rules.”

The ERC further noted that “the IPPAs shall comply with the provisions of the PGC, PDC, WESM Rules and manuals and applicable rules of the ERC for the duration of the CoC.”

The IPPAs are the qualified independent entities appointed by privatization agency Power Sector Assets and Liabilities Management Corporation (PSALM) to administer and manage the contracted capacity of the NPC-IPPs.

The privatization of the contractual obligations of NPC is among the policy reforms enunciated under the Electric Power Industry Reform Act (EPIRA) as a way to widen competition in the industry. It was hoped that with broader base of competition, consumers will eventually benefit from cost-competitive electricity rates or better services, although these are not seen much yet in the phased deregulation of the industry.

On market share limitation, the ERC noted that the same cap of 30-percent per grid and 25 percent on national level based on installed generating capacity; shall be imposed to the IPPAs.

So far, the current biggest player in the IPPA genre is San Miguel Energy Corporation (SMEC) which already cornered the NPC contracts for the 1,200-MW Sual coal plant, 345-MW San Roque hydropower plant and recently, the 1,200-MW Ilijan natural gas-fired plant. The only other IPPAs at this time are Aboitiz group for the 735-MW Pagbilao coal-fired power facility and Amlan Power Holdings for the 100-MW Bakun-Benguet hydro plants.

On prescribed financial standards, the ERC Rules stipulated that the IPPAs shall also conform with the instituted policies.