ERC to draft new rules on nuclear power rates

MANILA, Philippines – The Energy Regulatory Commission (ERC) said it is ready to draft new rules on the rate structure for nuclear power development once government approves a nuclear energy program.

“We are prepared to come up with a rate structure for nuclear but so far we have not been officially informed by the government,” ERC executive director Francis Saturnino Juan said.

“If it will involve rate setting, it will be made by the ERC. But it depends on the government if it will create a new re-gulator for nuclear. If the proponents will be executing power supply agreements, it has to be approved by the ERC,” he said.

The ERC executive, however, admitted there is a need for a careful evaluation of the cost structure appropriate for nuclear energy. “We need to come up with an appropriate rate-setting mechanism and how to evaluate what is a reasonable cost to consumers.”

He also said the ERC may also step in as soon as a nuclear power company decides to put up a facility. “We will be the one approving the project for nuclear as this will entail cost which will eventually be passed on to consumers.”

Juan said they also welcome any plan of the government to enact a separate law for nuclear energy development in the country.

“I heard there is a nuclear energy law that is being proposed in Congress that will govern the nuclear energy development in the country. The law, they said, will call for the setting up of a separate regulator for nuclear,” he said.

According to Juan, this may be consistent with the plan to use a private-public partnership (PPP) initiative in nuclear energy program as these projects are capital-intensive.

Earlier, it was floated that government may consider putting nuclear energy development projects under the PPP scheme.

National Power Corp. (Napocor) president Froilan Tampinco said during the recently-concluded Nuclear Power Forum Philippines 2010 that “there should be a strategic private-public partnership in developing nuclear energy.”

“Under the present scheme of the government, the PPP program, there can be a possible strategic partnership between the government and the private sector, in order to take care of handling a possible entry of nuclear facility,” he said.

Napocor is part of a Department of Energy (DOE) team formed to push for nuclear energy development in the country.

The mothballed Bataan Nuclear Power Plant (BNPP) is 100-percent-owned by the Philippine government.

The PPP initiative was recently launched by the Aquino administration to provide protection as part of the contracts to be entered into between government and winning bidders of PPP projects. –Donnabelle L. Gatdula (The Philippine Star)