ERC Issues 40 Show-Cause Orders to GenCos Over Non-Compliance in Fuel Audit Submissions

PASIG CITY—The Energy Regulatory Commission (ERC) has issued forty (40) show-cause orders (SCOs) to generation companies (GenCos) for failing to comply with the Commission’s directive to submit complete fuel purchase documents necessary in validating the reasonableness of generation charges being passed on to consumers.

In several Orders, the Commission sought the explanation of GenCos for failing to act on ERC’s Letter-Orders issued between December 2022 and March 2024 requiring the submission of complete sets of fuel cost data and documents covering the period from January to October 2022 to ensure that only reasonable and justifiable fuel expenses are charged to consumers in the exercise of its regulatory mandate.

The GenCos served with SCOs include Anda Power Corporation (APC), Angeles Power Inc. (API), Bukidnon Power Corporation (BPC), Calamian Islands Power, Corp. (CIPC), Delta Power, Inc. (DPI), DMCI Power Corp. (DPC), DMCI Masbate Power Corporation (DMCI-MPC), KEPCO SPC Power Corporation (KSPC), King Energy Generation, Inc. (KEGI), Masinloc Power Partners Co. Ltd. (MPPCL), Minergy Power Corporation (MINERGY), Nickel Asia Corporation (NAC), North Bukidnon Power Corporation (NBPC), OrMin Power, Inc. (OPI), Palawan Power Generation, Inc. (PPGI), Panay Energy Development Corporation (PEDC), Peakpower Soccsargen, Inc. (PSI), Peakpower Bukidnon Inc. (PBI), Peakpower San Francisco, Inc. (PSFI), Power One Corporation (POC), Powersource Philippines Energy, Inc. (PSPEI), San Miguel Energy Corporation (SMEC), SMC Consolidated Power Corporation (SCPC), Siquijor Island Power Corp. (SIPCOR), San Miguel Consolidated Power Corporation (SMCPC), SPC Island Power Corporation (SIPC), Strategic Energy Development Inc. (SEDI), Therma Luzon, Inc. (TLI), Toledo Power Corporation (TPC), Western Mindanao Power Corporation (WMPC), FDC Misamis Power Corporation (FDC), GNPower Dinginin, Ltd. Co. (GNPD), GNPower Mariveles Energy Center, Ltd. Co. (GMEC), Mapalad Energy Generating Corporation (MEGC), Sarangani Energy Corporation (SEC), Palm Concepcion Power Corporation (PCPC), and Supreme Power Corporation (SPC).

The Commission directed the GenCos to submit the required documents and a Verified Explanation within fifteen (15) days from receipt of the Decision. The power facilities must justify why no administrative penalty should be imposed for their failure to comply with ERC’s directives, in accordance with Sections 43(o) and 43(r) of Republic Act No. 9136, or the Electric Power Industry Reform Act (EPIRA), and with the terms of their ERC-approved power supply agreements (PSAs) with various distribution utilities (DUs).

Fuel invoices must be submitted on a monthly basis to support pass-through fuel costs reflected in the billings of GenCos. These invoices are necessary for DUs to verify whether the volume, price, and efficiency rates of pass-through costs fall within the formula and cap prescribed by the Commission in the Order or Decision approving the implementation of their PSAs.

If no sufficient basis is found for the recovery of the costs, they cannot be charged to consumers, or must be refunded if already billed. Failure by either DUs or GenCos to submit the required documents and to validate the pass-on charges may result in administrative liability and the imposition of fines.

“The ERC continues to conduct rigorous fuel audits to make sure that only fair and reasonable costs are being charged by our regulated entities. We owe it to the Filipino consumers to protect them from unnecessary charges and ensure that they’re not paying more than they should for electricity,” ERC Chairperson and CEO Monalisa C. Dimalanta said.

“We likewise remind GenCos and DUs to fully cooperate and comply with these requirements, so we can uphold transparency and deliver power at the least cost possible,” Chairperson Dimalanta added. ###