Electric rate increases in Veco, Meralco ‘alarming trend’ says solon

A PARTY  list lawmaker said government regulators should have scrutinized more the P1.00 increase per kilowatt hour in Metro Cebu “since the vagaries of the Wholesale Electricity Spot Market is complex and can be manipulated by selfish intersts.”

Bayan Muna party list Rep. Teddy Casiño said the trend of power rate increases is already alarming as it hit the two biggest metropolis in the country.

Also this month, the Manila Electric Company (Meralco) passed on to consumers a 54-centavo per kilowatt hour (kwh) increase.

“Yet again we should be wary that this trend might be deliberately aimed at manipulating Wholesale Electricity Spot Market (WESM) prices. We are calling on regulators, especially the Energy Regulatory Commission (ERC), to keep their eyes wide open and put their ears on the ground and watch out for signs of price manipulation,” Casiño said.

The increases that hit Metro Manila and Metro Cebu according to the progressive lawmaker “is a very alarming trend considering that world oil and coal prices are going down since January. Why are our electricity rates going up? World oil prices are US$80 per barrel and the average selling price of Indonesian coal (which Philippine coal fired plants use) will drop to US$78.80 per ton this year.”

“I understand that the Visayan Electric Company (Veco) as a distribution utility is merely passing on to consumers the 85-centavo per kWh increase in the generation charge due to higher costs of power bought at the Wholesale Electricity Spot Market (WESM) and the power price adjustments implemented by Napocor to recover so-called fuel, purchased power and foreign exchange costs,” he added.

Earlier, Veco had asked for understanding from power consumers saying they do not profit anything from the power adjustment as these are pass on increases.

“The higher Napocor rates charged to Veco is also unjust. Why do Cebuano residential and business consumers have to suffer due to the generation rate adjustment mechanism  of P0.4847/kWh for the next 10-and-a-half years and the incremental currency exchange rate adjustment  of P0.1213 for the next five years?” the progressive lawmaker asked.

Getting power from Napocor and the WESM with unjust and possibly manipulated prices is not good for business and employment in Cebu or any other part of the country.

“And the Energy Regulatory Commission (ERC) just approves every petition for a rate hike even if it will have dire results to millions of people,” Casiño said.

Veco is the country’s second largest private electric utility, with a franchise area covering the cities of Cebu, Mandaue, Naga and Talisay and the municipalities of Consolacion, Liloan, Minglanilla and San Fernando that have a combined population of 1.73 million.