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Philippines rural electrification regulatory framework project (English)

The objectives of the Government of the Philippines (GoP) with respect to rural electrification are: 1) improve financial performance of Electric Cooperatives (ECs) in order to enable them to reduce system losses and respond to growing consumer demands; 2) reduce the costs of supplying electricity to existing missionary areas, reduce the subsidy burden and increase supply in line with growing demand; 3) enable provision of services to areas which have been waived by ECs as unviable This report is organized in five sections: 1) Improving EC performance: In this section we summarize the main factors driving EC poor performance, and the required changes to the regulatory framework to remove these factors. 2) Investment Management Contracts (IMC): IMCs have been proposed as one option for improving EC performance. In this section authors explain the scope of IMCs, and the key contractual and regulatory issues that need to be solved before IMCs are implemented. 3) Private Sector Participation (PSP) in the National Power Corporation's (NPC) Small Power Utilities Group (SPUG): in this section authors explain the rationale for PSP in SPUG, and the strategic and regulatory challenges that will arise when implementing this initiative. 4) Qualified Third Parties (QTP) in unviable areas: an area is considered unviable when immediate extension of the distribution line is not feasible. In this section authors explain how QTPs will be allowed to electrify these areas and the regulatory implications that these will bring. 5) Output-Based Aid (OBA): feasibility of rural electrification depends on ability to provide subsidies where the true cost of supply is too high. OBA involves delegating generation or supply responsibility to a private firm under a contract that connects disbursement of subsidies to the services or outputs delivered. In this section authors explain how OBA applies to PSP in SPUG and waived areas.


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    ESMAP Paper

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    East Asia and Pacific,

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    Philippines rural electrification regulatory framework project

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Philippines rural electrification regulatory framework project (English). Energy Sector Management Assistance Program (ESMAP) Washington, D.C. : World Bank Group.