CABANATUAN CITY—While power rates are increasing in many areas in the country, including Metro Manila, consumers in this Nueva Ecija city are about to enjoy a decrease in rates.
In an open letter, Cabanatuan Electric Corp. (Celcor) asked its consumers not to worry amid reports of high power rates because the firm was set to lower its rates after a review by the Energy Regulatory Commission (ERC).
Celcor said it would announce the rate decrease after the ERC determines the exact amount.
The Celcor notice said the firm’s strict monitoring of the movement of prices at the electricity spot market and changes in its approach in power trading made the decrease possible.
Among the reasons the firm cited for the rate decrease were the signing of a memorandum of agreement (MOA) with Therma Luzon Inc. (TLI), direct membership in the wholesale electricity spot market (WESM) and the creation of the First Cabanatuan Ventures Corp. (FCVC) power plant, which is powered by bunker fuel but is an alternative electricity source for Celcor.
With the MOA, Celcor is able to buy electricity from TLI on a fixed price. Celcor’s direct membership in WESM enables the firm to buy or sell electricity directly in the spot market without middlemen.
The FCVC has been a readily available source whenever rates in WESM surge or in the absence of any other source of electricity in case of a massive blackout caused by supply shortage or damage to distribution lines.
A local power industry source, who asked not to be named for lack of authority to speak on the matter, said Celcor had formed a team that studies and analyzes the spot market activity on an hourly basis. This team advises Celcor to tap FCVC when prices at WESM increase, the source said.
The FCVC saved Celcor consumers from the skyrocketing power rates from September to December last year when Luzon experienced increases in WESM rates.
Celcor said the increases were due to the massive damage wrought by typhoons on power plants and transmission lines that distribute electricity from the Visayas to Luzon, the annual maintenance shutdown of the Malampaya natural gas complex and the unexpected breakdown of several power plants.
“Instead of sourcing electricity from WESM, Celcor was able to supply the market,” it said. “In this situation, Celcor, instead of paying WESM, is the one that receives payment, resulting in a significant drop in power rates in Cabanatuan.” Armand Galang, Inquirer Central Luzon