THE Energy Regulatory Commission (ERC) said on Thursday it has awarded Corenergy Inc. a Retail Electricity Supplier (RES) license after the company was found to have substantially complied with the technical, financial, and administrative requisites to operate and sustain a retail supply business.
The ERC said the license was granted last September 20.
Under the RES mechanism, commercial and industrial customers are given priority in choosing the most advantageous supply offer to encourage more competitive power rates.
Corenergy aims to supply power to qualified industrial, manufacturing, and commercial customers located in Luzon and the Visayas, and eventually in Mindanao, once the Retail Competition and Open Access (RCOA) regime is declared there.
It plans to sell an initial capacity of 100 megawatts in the first year, which would account for a 2.35 percent market share of total contestable customer demand.
“We welcome Corenergy, Inc. to the retail supply business. Its presence will provide consumers with more choices of electricity suppliers,” ERC chairman and CEO Jose Vicente B. Salazar said.
The company is owned by Vivant Energy Corporation (VEC), a subsidiary of Vivant Corporation (VVT). Its primary purpose is to buy, source and obtain electricity from generating companies or from the Wholesale Electricity Spot Market (WESM) to sell, broker, market or aggregate electricity to the end-users in the contestable market.
Corenergy was registered with the Securities and Exchange Commission on 14 December 2012.
In order to guarantee the energy company obligations to its customers, it will be contracting 50 percent of the requirement from coal and hydro generator facilities. For its peaking requirement, it will be sourcing out from bunker technology. It also plans to source a portion of its energy requirement from the WESM to take advantage of the relatively cheap annual weighted- average cost of electricity.
To mitigate the impact of a sudden spike of prices in the WESM due to unplanned outages of power plants, Corenergy will also contract with a peaking plant that will act as a hedge against any sharp increase of prices in the WESM.
Corenergy is required to establish and operate its own website for the convenience of its customers.
Effective 26 June 2016, 12 contestable customers (CC) with an average peak demand of 750-999 kilowatts (kW) opted to register in the retail market.
The retail market currently reflects 36 suppliers, with 16 RES, 12 local retail electricity suppliers (Local RES) and six suppliers of last resort (SOLR).
Manila Electric Company’s (Meralco) local RES is currently the largest supplier in terms of volume and has 229 CCs registered in the retail market.
Twenty-five distribution utilities and distributors in economic zones are also registered in the retail market as metering services providers tasked to ensure the integrity of metering data transmitted to the Philippine Electricity Market Corporation (PEMC), operator of WESM, as the central registration body.