PCC flags competition concerns in retail power market

THE PHILIPPINE Competition Commission (PCC) said the government may need to review rules governing companies involved in both electricity generation and retail supply, citing competition concerns in the retail electricity market.

Citing its market study, the PCC said retail electricity suppliers (RES) affiliated with power generators may have easier access to electricity supply, making it more difficult for other industry players to compete.

“If generators would prioritize supplying electricity through bilateral contracts, spot market, and retail supply agreement with their affiliate retailer, independent retailers would be left with residual supply,” the competition watchdog said in a statement on Monday.

The PCC said revisiting policies on vertical integration between generation and retail distribution may be necessary to enhance competition in the retail market.

There are 57 licensed RES and 30 authorized local RES, based on Energy Regulatory Commission (ERC) data as of end-2025.

Electricity retailing allows licensed suppliers to sell electricity directly to eligible consumers, as stipulated under the Electric Power Industry Reform Act (EPIRA).

The law mandates the implementation of retail competition and open access (RCOA), which allows consumers to choose their electricity supplier.

As of end-2025, there were 3,737 eligible end-users that met the threshold, representing an actual demand of 6.36 gigawatts, according to the ERC.

Initial findings of the PCC’s market study showed that barriers continue to limit the ability of eligible customers to switch to RES, including limited awareness of the process and delays in the procurement and installation of retail metering systems.

The PCC also noted a high level of “affiliate switching,” where customers move between retail suppliers affiliated with the same parent company.

It said such practices do not necessarily result in increased competition and may require measures to ease the entry of independent retailers to broaden consumer choice.

The agency recently conducted a strategic policy dialogue with the Independent Electricity Market Operator of the Philippines (IEMOP) to discuss the findings of its study on competition and switching barriers in the retail electricity market.

IEMOP operates the Wholesale Electricity Spot Market, where energy companies can purchase power when long-term contracted supply is insufficient.

Both agencies expressed interest in collaborating, including sharing data and research outputs, as well as promoting awareness of customer choice programs available to eligible electricity consumers.

Starting June, the minimum threshold for participation in the retail market will be lowered from 500 kilowatts (kW) to 100 kW, a move expected to increase customer participation and potentially support competition.

To prepare for the anticipated increase, IEMOP is upgrading its central registration system to streamline and automate customer switching requirements. — Sheldeen Joy Talavera