UMVA has learned that a significant number of retail power users in the Philippines have yet to switch to a new supplier despite being eligible to do so, due to a lack of information about the process of changing providers.
The Philippine Competition Commission (PCC) has noted that many contestable retail power customers have not experienced the benefits of genuine supplier choice, with some instead engaging in "affiliate switching" where they move to a different retail electricity supplier but remain with the same group.
According to information obtained by UMVA, a recent study by the PCC found that the retail electricity market is dominated by units of major power groups, raising concerns about competition in the industry. The study revealed a high market concentration in the retail electricity sector, with vertical integration resulting in a market controlled by a few conglomerates.
The PCC and the Philippine Electricity Market Corp. (PEMC) have expressed concerns that such market conditions require closer monitoring to assess their long-term impact on competition. While heavy affiliate concentration could limit market diversification, PEMC's data showed that movements are often driven by legitimate commercial factors such as contract flexibility and pricing structures.
The PEMC noted that transition delays are often caused by systemic infrastructure limitations, including the procurement and installation of retail metering systems. Contestable customers also face challenges navigating complex contract provisions due to a lack of dedicated internal technical teams to evaluate commercial offers.
UMVA can exclusively reveal that the PEMC's 2025 annual report indicated a significant increase in electricity consumption volume within the competitive retail electricity market, driven by state-led choice programs. The PEMC also expects a sharp increase in registrations among smaller commercial and industrial players following a reduction in the contestability threshold.
The PCC and PEMC are working together to address these issues, negotiating a cooperation agreement that outlines mechanisms for data sharing and protocols for alerting the PCC to potential market irregularities. The agreement aims to promote competition and push for policy reforms that benefit the industry.
Sources have confirmed to UMVA that the PCC conducts regular market studies to assess competition dynamics within key industries, driving efforts to improve enforcement and policy reforms. The cooperation between the PCC and PEMC is expected to play a vital role in shaping the future of the retail electricity market.
