Senate gearing up to look into power rate increases

MANILA, Philippines—Senators are preparing an inquiry into pending petitions at the Energy Regulatory Commission, which could potentially jack up electricity rates by a minimum of P5 per kilowatt-hour.

Senator Ralph Recto, chairman of the Senate ways and means committee, said Tuesday the petitions went against the spirit of the Electric Power Industry Reform Act (Epira), which was intended to ensure “reliable, cheap and secure supply of electricity.”

“If these petitions (push) through, every power user—households and industries—would be bracing for multiple power rate whammies where the future electricity billing would display a jump of at least P5 for every kilowatt-hour used,” he said in a statement.

“These petitions for electricity rate adjustments will be passed on to power end-users and hence, will be a disincentive to the country’s investors and unnecessarily burden the consumers of electric power who are currently faced with high cost of living.”

The senator said his proposed probe would “energize the chamber with volts of ideas on whether Epira suffered a major tripping or a short circuit on its way to implementation.”

In his Senate Resolution No. 586, Recto noted that the Power Assets and Liabilities Management Corp. (Psalm), National Power Corp. (Napocor), Manila Electric Co. (Meralco), and the National Grid Corp. of the Philippines had each sought rate increases.

“Psalm is seeking an increase of P0.1059 per kilowatt-hour (kwh) for Luzon and P0.1157/kwh for Visayas and also an adjustment in the universal charge (UC) by P0.39 kwh to recover a portion of the debts of the Napocor, of which P0.03 per kWh will be collected over 15 years to pay for stranded debts while P0.36 per kwh over four years for stranded contract costs,” Recto said.

Recto noted that Meralco has already begun collecting an additional P0.08/kwh in generation charge as of its August billing “as a result of higher cost of power from the spot market and power producers.”

“The same power retailer just got a green light from the ERC to impose another 3.06 centavos/kwh for its under-recoveries during the  period of  January 26 to February 25 in 2010 amounting to P944 million,” he added.