The Energy Regulatory Commission (ERC) has issued 40 show cause orders (SCOs) to 37 power generation companies (gencos), for failing to submit complete fuel data for the 2022 audit period—raising serious implications for transparency, cost recovery, and regulatory compliance in the domestic power sector.
The SCOs, disclosed by the ERC on Wednesday, address violations under Section 43 of the Electric Power Industry Reform Act (EPIRA) of 2001, which mandates fuel audits to deter anti-competitive behavior and ensure only justifiable fuel costs are passed on to consumers. The cited firms were given 15 days to justify their non-compliance or face administrative sanctions.
According to ERC chairman Monalisa Dimalanta, fuel invoice submissions are vital for verifying whether pass-through fuel charges in power supply agreements (PSAs) fall within approved limits. These charges directly impact the cost of electricity to consumers. “We owe it to the Filipino consumers to protect them from unnecessary charges and ensure that they’re not paying more than they should,” Dimalanta said.
Among those served SCOs were Masinloc Power Partners Co. Ltd., GNPower Dinginin Ltd. Co., Therma Luzon Inc., Palm Concepcion Power Corp., and SPC Island Power Corp. that highlight the breadth of corporate exposure and potential financial liability across Luzon, the Visayas, and Mindanao.
The SCOs not only signal a heightened enforcement regime under the ERC but also introduce potential commercial risks for gencos, including disallowance of cost recovery and reputational consequences, especially in an era of increasing scrutiny over energy pricing and market behavior.
Industry observers note the regulatory push for audit transparency affects future bidding and contracting dynamics, especially for distribution utilities seeking PSA approvals. It also reinforces the strategic role of policy compliance in maintaining competitive advantage in a tightly regulated market.
The ERC emphasized that failure to validate pass-on charges may require refunds to consumers, placing both gencos and distribution utilities under pressure to uphold documentation and transparency standards in their cost submissions.
