New power distributor looms in Iloilo

Errors in billing and overcharging have led to a 1,000 percent increase in charges being collected from electricity consumers in Iloilo City, prompting many congressmen to act against renewing the franchise for the city’s power distributor.

Rep. Franz Josef Alvarez, chair of the House committee on legislative franchises, said the 1,000 percent increase in consumers’ bills as a result of failure by Panay Electric Co. (Peco) to rationalize its billing system was just one of several acts of incompetence that convinced congressmen to reject an extension of Peco’s franchise.

Peco has been distributing power in Iloilo City for the past 90 years. Its franchise expires in January next year.

Complaints

Early this year, Iloilo City Councilor Joshua Alim asked the Energy Regulatory Commission (ERC) to address complaints against excess billing by Peco, which came after a new metering system was adopted.

The ERC resolved 80 percent of the complaints except those on increased charges related to billing systems.

Alim had cited a report of Singapore consultancy firm WSP, which concluded that Peco continued to lag behind power distributors in other Philippine cities like those in Manila, Cebu and Davao
in terms of systems and infrastructure reform.

Complaints against Peco led to the House approving on second reading a bill granting franchise to distribute power in Iloilo City to another distributor.

90 years

House Bill No. 8302 was approved on Oct. 2, according to the House website.

The bill, if passed into law, would end Peco’s 90-year hold on power distribution in the city.

Alim welcomed the bill’s approval, saying Ilonggos deserved a new power distribution company.

The Iloilo City Council had expressed opposition to renewing the Peco franchise through a resolution filed by Councilor R. Leone Gerochi.

Mikel Afzelius, Peco corporate communications officer, denied reports of overcharging.

He said Peco had invested billions of pesos in upgrading services and setting up new lines and substations because of increased demand.

He also denied a report that Peco owed P631 million in refund.

Afzelius said Peco had incorporated the refund of more than 15 centavos per kilowatt hour in every billing statement since 2009.

Only P31 million remains to be refunded, which will be completed by the second quarter of next year, he said. —With a report from Nestor P. Burgos