Acting Energy Secretary Jose C. Ibazeta hinted in a talk before the Energy Committee of the American Chamber of Commerce of the Philippines (AmCham) that open access will finally kick off in the deregulated power industry this June 2010.

The energy chief, according to AmCham, based his statement on the timeline of the Power Sector Assets and Liabilities Management Corporation  (PSALM) at meeting the 70 percent privatization threshold for the National Power Corporation’s contracts with the independent power producers.

Nevertheless, it rests upon the powers of the Energy Regulatory Commission (ERC) to officially declare on when open access will finally commence. With all the legal requirements already attained, the earlier propounded interim open access can finally be shelved.

PSALM successfully auctioned recently the IPP Administrator (IPPA) appointment for the Ilijan plant’s contract and that already brought privatization level of the IPPs to 68 percent.

The privatization firm lined up next the IPPA appointment for the Malaya facility, and success on that undertaking will more than surpass the required threshold.

The last unaccomplished requirement for open access, as directed under the Electric Power Industry Reform Act (EPIRA), would be meeting 70-percent privatization of the IPP contracts. The mandated divestment of NPC generating assets has long exceeded the prescribed threshold.

Open access is the era that shall finally propel competition in the industry.

It will initially give the ‘power of choice’ on suppliers to big-ticket end users, primarily those within the 1.0 megawatt band of peak demand. The threshold will go down gradually until it reaches the household level.

From investors’ viewpoint, open access will mean having alternative marketing strategy for their planned capacity – be it brownfield or greenfield projects.

There are a number of American companies considering fresh capital infusion for projects in the Philippine power industry, but they are also closely watching developments in the policy reforms arena as these may have bearing on their investment plans.

As they are navigating an uncharted terrain in the restructured electricity industry, the US firms are also extremely careful in casting project blueprints as the risks may eventually trigger fallout of such dollar investments.

The year 2011 and onwards anticipate massive expansion in the power sector given worsening predicaments of tight supply; that if not immediately remedied, may descend into another round of power crisis.