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ERC partners with US incrafting gas rules

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By Myrna M. Velasco

The Energy Regulatory Commission (ERC) has cemented a partnership with the league of American energy regulators for the crafting of regulation framework for the Philippine gas sector.

ERC logo(Photo courtesy of www.erc.gov.ph)

ERC logo(Photo courtesy of www.erc.gov.ph)

The tie-up entered into by ERC is with National Association of Regulatory Utility Commissioners (NARUC), an aggrupation of energy regulators comprising various states in America.

Aside from the propounded gas regulation framework, ERC also expects NARUC’s support in “establishing procedures for expediting review and processes of power purchase agreements.”

ERC has long been criticized for its very slow evaluation processes and its snail-paced frame of rendering decision on power supply deals – which often delays power projects; and at times, could also trigger power interruptions.

In a statement to the media, the ERC explained “the exchange provided a platform for NARUC to share regulatory expertise and strategies to promote gas market growth and adoption of best regulatory frameworks.”

The partnership with NARUC, according to the ERC, had been facilitated by the United States Agency for International Development (USAID) – an American agency that has been aiding the Philippine regulator on its work for decades already.

Nevertheless, since the deregulation of the power sector in 2001, there’s really not much improvement that can be vouched for on regulatory sphere in the energy sector. PSA approvals are still very much delayed; and the regulator is not moving that fast on performance-based rate setting’s (PBR) next regulatory reset.

In the gas industry, the United States can look for highly favorable prospects in the Philippines – primarily in the supply of gas from that shale-endowed market. Hence, that will explain the high level of interest that America has been showing in shaping the country’s gas regulatory framework.

US firms have not been aggressively investing in the Philippine energy sector in recent years, but with the opportunities they have been seeing in the gas sector, the world’s biggest economy’s revived interest is manifest – even on strategies of dipping its hand into the gas policymaking and regulation framing of the Philippines.

At this stage, ERC Chairperson Agnes T. Devanadera asserted that the presentations made to them by the former Commissioners of NARUC had been “truly beneficial for the ERC considering the government’s thrust to provide a conducive environment through the issuance of policies, plans and programs” for the gas sector.

Gas is an electricity generation fuel being advanced by the Department of Energy (DOE) in meeting the country’s need for immediate power capacity additions; as well as to address flexibility concerns in the grid given the anticipated higher integration of renewables into the country’s power grids.

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