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EC Joint Action

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Presentation to Edita Bueno, NEA Administrator and other NEA executives

Presentation to Edita Bueno, NEA Administrator and other NEA executives

Published in: Business, Technology
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  • 1. Power Supply Joint-Action Nick Nichols Viking Logarta 1
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  • 4. To Download a copy of Report, go here: http://drop.io/3mitlvk# Philippine Power Sector Blog http://asianenergyadvisors.com Email: nick@asianenergyadvisors.com viking@asianenergyadvisors.com 4
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  • 7. What ECs Pay NPC For Cor. Agham Rd. Power Out of the And and Quezon Ave. Generator 7
  • 8. What ECs Pay NPC For Planning Procurement Power Out of the Generator Contract Dispatch Management Services 8
  • 9. Under EPIRA, ECs will pay IPP for: Power Out of the Generator 9
  • 10. Planning Procurement You have to do all of these ... WESM Contract Participation Management & Dispatch 10
  • 11. ... To Get This Power Out of the Generator 11
  • 12. Procurement Process WESM Contract Participation Management & Dispatch 12
  • 13. Shifting these costs to ECs need not add costs to ratepayers 13
  • 14. But we can’t have a mini NPC at each EC 14
  • 15. Fundamental Drivers Bargaining Power Shared Services (to lower costs) Procure expertise in short supply 15
  • 16. Two Models Joint Services Power Supply Cooperative 16
  • 17. Bigger roadblocks to establishing Supply Cooperative But Joint Services implementation facer greater challenges in conducting power supply procurement 17
  • 18. Joint Services • Not empowered to buy and sell power • Acts as agent • Facilitates conduct of power supply activities • Could be a consortium of EC or outsourced to a private sector firm 18
  • 19. Joint Services Problems • Coordinated procurement mechanics complex for robust supply portfolio • Juggle 1-to-1 allocations of IPP products • IPPs continue to price offers based on fractured nature of ECs • Doesn’t have “sole obligation” to procure 19
  • 20. Supply Cooperative • Juridical entity that can buy and sell power • Can perform Planning, Procurement, Contract Management, Dispatch 20
  • 21. Supply Cooperative Juridical Entity Issues • Wholesale Aggregator? - 5 Yrs 21
  • 22. Supply Cooperative Juridical Entity Issues • Wholesale Aggregator? - So far all are SEC. Not-for-profits? 22
  • 23. Supply Cooperative Juridical Entity Issues • Wholesale Aggregator? - Under EPIRA it’s a Generator Sector entity thus subject to cross-ownership and anti-competitive rules 23
  • 24. Supply Cooperative Juridical Entity Issues • Wholesale Aggregator? - ECs must procure under ERC’s competitive solicitation guidelines 24
  • 25. Why Full-Requirements Contracts may be important 25
  • 26. Why Full-Requirements Contracts may be important Open Access Considerations 25
  • 27. Sales for Resale Issues • Under EPIRA, Sales for Resale are not price-regulated by ERC 26
  • 28. Cost Recovery Issues • Under Joint Services - no roadmap for cost recovery by DUs & it’s not in the “benchmarks” • Under Supply Cooperative - more like NPC. Except - NPC’s tariffs were regulated. 27
  • 29. Special Nature of Supply Cooperative • Supply Cooperative = joint action extension of ECs own obligation to procure competitively • Supply Cooperative undertakes competitive solicitation. EC members should be relieved of obligation • Sales for Resale are not regulated under EPIRA. What is regulatory framework? 28
  • 30. Transitioning to Supply Co-op - Work to be done • Legal & Regulatory, Consultations --> Appropriate juridical entity • ERC, Congressional, SEC? Processes • Charter, governance issues, licenses • Staffing Plan, Financing Plan, Action Plan • Can’t expect first regional group to 29
  • 31. Photo Credit Hubble Space Telescope, photo PR96-27B by the European Space Agency and NASA http://grin.hq.nasa.gov/BROWSE/gallaxies_3.html Emission nebula NGC 604 lies in a spiral arm of galaxy M33, 2.7 million light- years away in the constellation Triangulum. This is a site where stars are being born. 30

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