Panay power firm lowers electric rates for Iloilo City

ILOILO CITY – Iloilo City residents have been given a respite on high electricity rates after the Panay Electric Co. (Peco) significantly lowered its rates.

The Peco announced that it reduced its rates effective this June from P10.40 per kilowatt hour to P7.71 per kWh or a P2.69 per kWh drop.

Peco, one of the oldest private electric firms in the country, is the lone electric distributor of the city’s 180 barangay (villages) with at least 40,000 consumers.

Engineer Randy Pastolero, Peco operations manager, said the decrease in rates was due to the approval of the Energy Regulatory Commission (ERC) for a reduction of the capacity fees it is paying the Panay Power Corp. (PPC) which supplies part of Peco’s needs through diesel-fired power plants.

The current rate is significantly lower than Peco’s P12.58 per kWh rate in November 2010. It had also reduced its rate from P12.58 per kWh to P10.57 per kWh in February after sourcing the bulk of its power requirements from the 164-megawatt coal-fired power plant of the Panay Energy Development Corp. (PEDC), a subsidiary of the Global Business Power Corp.

Pastolero said the P7.71 per kWh rate may be temporary until the approval of the ERC of the energy contract between Peco and the PEDC. PEDC is charging a temporary rate of P2.87 per kWh.

He said they were projecting a rate of around P10 per kWh when the contract is approved.

But he said the company would still have one of the lowest power rates among electric cooperatives in the country with rates ranging from P11 to P12 per kWh after the National Power Corp. (Napocor) stopped providing subsidized power supply.

Peco had come under fire from the non-government organization Freedom from Debt Coalition (FDC) who accused the company of having one of the highest electricity rates among at least 63 countries.

But Pastolero explained that Peco’s rates were higher compared to other areas in the country because it was supplied by diesel power plants of the PPC and was no longer covered by subsidies of Napocor.

The city’s unstable power supply and high electricity rates have been blamed by business groups as among the reasons prospective investors are hesitant in putting capital in the city.

But the operation of the 164-MW coal-fired power plant starting late last year has significantly reduced power interruptions.