POWER companies that have not complied with an industry-wide listing requirement represent 54% of all such firms and account for nearly 14,000 megawatts (MW) of generating capacity, the Energy Regulatory Commission (ERC) said.
“For those who are not compliant yet as of now, they at various levels of compliance…These are 136 generation companies, which account for 54% of all generating companies. Their capacity is around 14,000 MW,” Rochelle V. Moreno, chief energy regulation officer at ERC, said during a Securities and Exchange Commission (SEC) event on Thursday.
Section 43 of the Electric Power Industry Reform Act (EPIRA) requires unlisted generating companies and distribution utilities to offer and sell to the public at least 15% of their common stock.
New companies are required to offer shares no later than five years from the issuance of their certificates of compliance (CoC). A CoC is a license issued by the ERC allowing the operation of a power plant or other facilities used in generating electricity.
Only 37 energy companies are fully compliant with the public offer rule, supplying 3,241.17 MW of capacity to the grid.
Non-compliant energy firms are subject to revocation of their CoCs or non-renewal of their licenses to operate.
“The consequence then is something that we find very difficult to enforce, to implement. Why? As you have seen, the impact of revoking the certificates of compliance for those that have not complied will be taking out 14 gigawatts of power from the system,” ERC Chairperson and Chief Executive Officer Monalisa C. Dimalanta said.
“Revoking their CoCs would be sort of a self-inflicted wound… because everyone will suffer. We just try to help them comply and SEC has been helping us out,” she added.
Ms. Dimalanta said many firms find the process of listing “really very intimidating, intensive, and costly.”
The SEC implemented last year the SEC POWERS program (Securing and Expanding Capital for Power Generation Operators and Wholesale Electricity and Retail Services.)
“As the overseer of the capital markets, we at the SEC remain steadfast in our mandate of creating a sound policy environment for all stakeholders — balancing the interests of the issuers and protecting the investing public,” SEC Chairman and CEO Emilio B. Aquino said.
The SEC committed to complete the review of the registration statement within 45 days from filing, in accordance with the requirements of the Securities Regulation Code, the Revised Corporation Code of the Philippines, and pertinent issuances of the SEC.
Citing the Philippine Energy Plan 2023-2050, Mr. Aquino said the Philippines will need around P67 trillion in investment to meet its energy requirements.
“As we are all aware, energy projects are very capital intensive. This is where the capital market can come in. We aim to introduce the limitless potential of tapping the capital markets as a financing solution to meet the growing demand of the energy sector,” Mr. Aquino said.
Ms. Dimalanta said that the ERC and SEC have been working together since 2023 through joint public consultations with over 100 members of the energy industry.
She said the target is to get an additional 100 energy companies to comply with the public offering rules within the next 12 months. — Sheldeen Joy Talavera