PRESS RELEASE
13 May 2026

PCC, NEA discuss competition and reform initiatives in the electricity distribution sector 

Policy dialogue between the PCC and NEA, held on April 29, 2026.

On April 29, the Philippine Competition Commission (PCC) and the National Electrification Administration (NEA) held a strategic policy dialogue (SPD) to discuss the findings and recommendations of the PCC’s Economics Office (EO) on possible reforms in the ownership structure of electric cooperatives (EC). With legislative franchises set to expire in the next five years, the EO’s paper advocates for the establishment of a mechanism that will promote competition in the energy sector, particularly in electricity distribution.  

The PCC highlighted that while reforms in ownership changes may improve efficiency, they may also risk increasing market concentration and vertical integration. The PCC emphasized the importance of well-designed competitive selection processes (CSP) to prevent anti-competitive coordination among bidders. This includes maintaining a large pool of bidders for certain geographical areas by encouraging both the incumbent and future distribution utilities to participate. CSP designs should take into consideration the possible vertical affiliations of ECs with power generation companies as well as the ability of prospective players to serve stranded or underserved communities. 

The NEA detailed its role as a financial, technical, and quasi-judicial entity that provides tailor-fitted interventions for underperforming ECs, ranging from technical support to governance reforms and the deployment of a task force to oversee board functions. The agency also affirmed its commitment to refer any observed anti-competitive behavior to the PCC. 

Both agencies acknowledged that reforms in the sector must account for the varied conditions of ECs, particularly those which operate in underserved and high-cost areas. A key focus of the discussion was the legal safeguard under Presidential Decree No. 269, which requires the assent of 50 percent plus one of the total member-consumers for any major asset transfer or ownership change. This stringent threshold ensures that privatization cannot proceed without the explicit approval of the cooperative’s majority, thereby protecting consumers against franchise creep and the potential stranding of remote areas. 

As part of its broader mission to implement the National Competition Policy, the PCC conducts market studies to guide government agencies in adopting pro-competitive policies. SPDs serve as a key mechanism for validating these studies and fostering a whole-of-government approach, ensuring that sectoral reforms translate to tangible benefits for consumers. 

### 

REFERENCE:  
publicaffairs@phcc.gov.ph  
Public Affairs and Research Division
Communications and Knowledge Management Office
Philippine Competition Commission