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The Department of Energy (DOE) is moving to recommend the suspension of about 40 power generation companies to the Energy Regulatory Commission (ERC) for failing to comply with orders requiring them to explain plant outages, reduced generation, and other reliability concerns.
Energy Secretary Sharon Garin said the government had already warned the companies and was preparing to elevate their cases to the ERC for appropriate action. She did not identify the generators but said many were small diesel-fired plants, including some that were no longer operating.
“We’ve given them a warning, and we are now in the process of recommending suspension to ERC (Energy Regulatory Commission),” Garin said in an interview over the weekend.
The move comes as electricity supply remains tight in the Visayas, where several large generating units are offline, and the grid has repeatedly been placed under yellow and red alerts.
Accountability Rules Tightened
The DOE issued 203 show-cause orders (SCOs) to power generation companies nationwide in July after they failed to submit mandatory self-assessment reports used by the agency to monitor plant reliability, outages, and available capacity.
The companies were also required to account for forced outages, reduced generation, and failures to deliver capacities they had committed to provide to the grid.
Garin said the DOE had been holding meetings since last week to determine how to proceed against generators that failed to respond to the orders. Their cases will now be sent to the ERC for proper action.
The DOE is also seeking public comments on a draft department circular containing supplemental guidelines for implementing and enforcing its genco accountability policy.
Under the proposed rules, a generator found to have committed a prima facie violation may be issued an SCO and placed under strict compliance monitoring. A first offense would result in a stern warning and an order to comply with the DOE’s monitoring requirements.
Failure to submit required reports or supporting documents within the prescribed period could constitute another offense. On a second offense, the case may be referred to the ERC, with the generator potentially facing suspension of its DOE-issued certificate of endorsement.
A third offense would bring more severe penalties, including possible blacklisting from DOE-administered programs and endorsement for the revocation of compliance certificates or other ERC-issued authorizations.
The DOE said the proposed rules are intended to ensure timely and accurate reporting while promoting due process and consistency in enforcement. The policy is also aimed at supporting the reliability, adequacy, security, and resilience of the power industry.
Visayas Grid Remains Under Pressure
The enforcement push comes as the Visayas grid continues to operate with limited reserves.
The National Grid Corp. of the Philippines (NGCP) placed the grid under a red alert on Monday, from 5 p.m. to 8 p.m., and yellow alerts from 2 p.m. to 5 p.m. and again from 8 p.m. to 10 p.m. because of continuing generating plant outages.
As of the latest grid condition cited by the energy department, 919 megawatts of capacity remained unavailable. Twenty-seven power plants were on forced outage, including seven units that went offline in August, while another 14 plants were operating at reduced capacity.
Major facilities TVI 1, TVI 2 and KSPC 1 remained offline, while electricity imports from Mindanao were limited. Available capacity in the Visayas was forecast at 2,318 MW against peak demand of 2,431 MW, leaving the system short of the capacity needed to meet demand and maintain sufficient operating reserves.
The situation has resulted in frequent yellow alerts and occasional red alerts in the region.
More Capacity Expected To Return
The supply outlook is expected to improve as several large coal-fired units return to service.
Garin said TVI Unit 2, with a capacity of 169 MW, and KEPCO SPC Power Corp.’s 105-MW unit were expected to return within the week. TVI Unit 1, also rated at 169 MW, and Cebu Energy Development Corp. Unit 1, with 135 MW, were scheduled to return in September.
“The Visayas grid continues to experience tight supply conditions… Power is on the way,” Garin said, adding that some outages were caused by plant damage while operators had assured the government they were working to restore their facilities.
The DOE has also directed NGCP to integrate about 250 MW from battery energy storage systems in Iloilo, Negros, Cebu, and Leyte to help balance the grid.
Garin said the additional battery capacity could significantly reduce the frequency of yellow and red alerts if the projects proceed and continue operating as planned.
Source:
https://www.philstar.com/business/2026/08/24/2551290/doe-40-erring-power-firms-face-suspension
https://business.inquirer.net/607252/40-power-plants-face-possible-suspension