File photo shows a Meralco lineman inspecting electric meters in San Andres, Manila. —INQUIRER PHOTO
MANILA, Philippines — The Manila Electric Company (Meralco) has earned support from a consumer group, urging lawmakers and other stakeholders instead to just help find solutions to high power costs rather than attack the company.
The Laban Konsyumer Inc. (LKI) on Friday questioned the rationale behind some groups’ decision to call out Meralco amid high electricity rates and power shortage, noting there seems to be a vested interest behind criticisms against the firm.
“We have recently noticed several ‘caused-oriented groups’, including lawmakers with vested interests, issuing negative statements on Meralco’s alleged overcharging that stemmed from the Energy Regulatory Commission’s (ERC) failure to update the computation for the Weighted Average Cost of Capital (WACC),” Jorge Bandola, one of LKI’s trustees, said in a statement.
The WACC, or the expected return a company should be getting to ensure the viability of its investments, was the topic of Santa Rosa City Rep. Dan Fernandez’s privilege speech last November 7 regarding Meralco.
READ: Meralco’s capital cost too high, passed on to customers – House rep
Fernandez claimed that Meralco connived with the ERC to delay a recomputation of the WACC.
A higher WACC means the company needs to make more profit to ensure its operations, while a lower rate indicates that the company does not need to make too high of a profit to sustain its investments.
Fernandez claimed that Meralco’s 14.97 percent WACC in 2010 was no longer accurate, adding that it should be reduced to 9.23 percent. This, he believed, would eventually lower the electric bills of consumers.
READ: 2 more House members echo Fernandez’s rant vs Meralco
Meralco spokesperson Joe Zaldarriaga disputed Fernandez’s claims, insisting in a statement sent to INQUIRER.net that the power distributor had been giving service beyond the expectations of its customers.
Fernandez also made other allegations that Meralco is monopolistic, which the company denied by showing that a lot of areas that the lawmaker mentioned featured different electric service providers.
For Bandola, Meralco would really need a big and solid funding to make sure it can efficiently operate or provide service to its customers.
Bandola also said that LKI believes the attacks on Meralco stems from aspirations of some groups and lawmakers to block the company’s franchise renewal in 2024 – even if residents and commercial establishments asked that Meralco replace existing electricity cooperatives in their locality due to inefficient services.
“We believe this is the main reason why negative and unwarranted news are currently circulating, a desperate move to block Meralco from continuously providing consumers efficient electricity supply with the lowest power rates in the country,” he said.
“This is the reason why LKI is appealing to our lawmakers to refrain from issuing statements and allegations that Meralco is overcharging electricity consumers, and divert their attention on electricity consumers’ power supply needs,” Bandola added.
This is not the first time that groups or lawmakers have supported Meralco’s stand. Last November 30, Cagayan de Oro 2nd District Rep. Rufus Rodriguez said that instead of calling to divide the Meralco franchise, the government and supposed consumer advocates should focus on finding ways to bring electricity prices down.
READ: Rep. Rodriguez to consumer advocates: Focus on bringing Meralco rates down
Pro-consumer group CitizenWatch Philippines also called out Fernandez’s privilege speech against Meralco, It said that the factual errors mentioned in the speech are “unproductive” and have derailed discussions on how to lower power rates.
Former lawmaker and CitizenWatch Philippines co-convenor Kit Belmonte warned that Fernandez’s privilege speech might be a mere attempt to sow intrigue.
READ: Groups call out Rep. Dan Fernandez for ‘unproductive’ speech vs Meralco