Economist calls for broader EPIRA reforms

An energy economist is calling for broader reforms to the Electric Power Industry Reform Act (EPIRA), saying institutions needed to ensure affordable and reliable electricity remain incomplete 25 after the landmark law was enacted.

According to economist Laurence Rogero, while the EPIRA addressed concerns of the power industry in the 1990s such as the debt of the National Power Corporation (Napocor), recurring blackouts, and lack of investment, gaps are still evident.

“The reform answered structural failures the old system could no longer sustain, and it has been, on balance, more successful than not,” he said in a paper released to mark the EPIRA’s 25th anniversary.

“The lesson is that markets require institutional complements that do not emerge automatically from privatization—and that those complements must be build in coordination, not in sequence,” he added.

Among the gaps Rogero cited was that regulatory independence should be “real” and not “merely statutory,” with the need for longer fixed terms, transparent appointments, and adequate staffing to ensure credibility.

He also called for a formal reserve-capacity framework which he said is overdue, and the need for enforceable build-out milestones and delay penalties for transmission concessions to ensure that the operator’s return tracks delivery.

Rogero likewise called for a comprehensive audit on subsidies, looking into which supports to keep, which to remove, and which to make visible, targeted, and accountable.

“These are not four problems but one: completing the coordinated build-out EPIRA’s big push assumed but did not secure. They are load-bearing walls. Remove one and the others lean,” he said.

To recall, President Ferdinand “Bongbong” Marcos Jr. in his State of the Nation Address (SONA) in 2024 called on Congress to review EPIRA to determine if there is a need to amend the law.

A measure making amendments to EPIRA, specifically to strengthen the Energy Regulatory Commission’s (ERC) oversight and consumer protection powers, is among the 48 Legislative-Executive Development Advisory Council (LEDAC) measures.

It was approved by the House of Representatives on third and final reading in January.

“EPIRA’s promise was never self-executing. A market was built; its institutions were not; and the gap between the two is what every household has been paying for. The reform’s second quarter-century will be judged less by what it started than by what it finally finishes,” Rogero said. — BM, GMA News