ERC lowers threshold to 100 kW, opening competitive power market to more Filipino consumers and households

More Filipino electricity consumers can now choose their own electricity suppliers following the official implementation of the 100-kilowatt (kW) contestability threshold under the Retail Competition and Open Access (RCOA) and the Retail Aggregation Program (RAP).

Pursuant to ERC Resolution No. 22, Series of 2025, the Energy Regulatory Commission (ERC) hailed this transition as one of the most significant milestones since the enactment of the Electric Power Industry Reform Act of 2001 (EPIRA). By aggressively lowering the contestability threshold from 500 kW to 100 kW, the Commission is democratizing access to the competitive retail electricity market.

With the lowered threshold, a broader segment of medium-sized operations can now bypass traditional captive utilities and directly contract with their preferred Retail Electricity Supplier (RES). These qualified consumers include:

• Medium-sized commercial establishments

• Schools and universities

• Hospitals and medical centers

• Office buildings and hotels

• Manufacturing facilities and industrial users

In a historic first, the reform extends the power of choice to residential communities and smaller consumers. Through the Retail Aggregation Program (RAP), households and small businesses that individually fall below the 100-kW requirement can now pool their electricity demand. This allows them to collectively enter the competitive retail market and secure better power supply agreements as a single unit.

The initial implementation phase demonstrates robust market confidence, with dozens of consumers already transitioning to competitive contracting:

The 11 newly scheduled Retail Aggregated Groups (RAGs) in Luzon notably include participants at the household level, marking the first time ordinary residential consumers are actively participating in the competitive retail market.

ERC Chairperson and CEO Atty. Francis Saturnino C. Juan described the reform as a landmark shift that places the Filipino consumer at the center of the country’s evolving energy landscape.

“The lowering of the contestability threshold to 100 kilowatts is more than a regulatory milestone—it is a milestone for Filipino consumers,” Chairperson Juan said. “For the first time, residential communities are participating in the competitive retail market through aggregation, extending the power of choice beyond large corporations and industrial customers to ordinary households. This reform empowers consumers to seek electricity solutions that best fit their needs while encouraging suppliers to compete through better prices, innovative products, and improved customer service.”

He further emphasized that a broader market drives industry-wide innovation:

“Competition works best when more consumers are able to participate. As the market expands, electricity suppliers are encouraged to become more efficient and responsive… This is the direction envisioned under EPIRA—an electricity sector that is transparent, competitive, and ultimately driven by the interests of the Filipino people.”

The ERC extended its appreciation to key industry partners for their seamless collaboration in preparing the market for this transition, including:

• The Department of Energy (DOE)

• The Independent Electricity Market Operator of the Philippines (IEMOP)

• Retail Electricity Suppliers (RES)

• Distribution Utilities (DUs)

Moving forward, the ERC reaffirms its commitment to consumer protection through rigorous market oversight and responsive regulation, ensuring a transparent, reliable, and affordable energy market for all Filipinos.