Meco: Customers not overcharged

MACTAN Electric Company (Meco) does not overcharge consumers.

That’s according to Gilbert Pagobo, Meco senior vice president and general manager, during a hearing of the committee on energy of the Lapu-Lapu City Council on Thursday, Sept. 1, 2022.

While he admitted that electric bills have gone up, he attributed this to transmission and generation rates increasing from time to time.

He said Meco has not raised the distribution charge of P1.4408 per kilowatt-hour for 12 years, saying it is the only rate Meco earns from based on the Energy Regulatory Commission (ERC) regulations.

He said Meco’s total average rate of P14.1550 in August was not much higher compared to the rates of other distribution lines.

Coal prices

Quoting the Cebu Energy Development Corp. (CEDC), Meco’s power supplier, Pagobo said the price of coal and the peso and US dollar exchange rate have affected the cost of power.

He said the price of coal in 2019 and 2020 was US$80 per metric ton on average compared to the current price of US$396.21 per metric ton.

The increase started in 2021 before skyrocketing in the first quarter of 2022 due to the Russian invasion of Ukraine in February, Pagobo further explained.

Russia is the biggest natural gas exporter and second biggest exporter of crude oil in the world.

“When the electric bill goes up, it’s not only because the price of coal went up but the cost of transportation also increased, which is very much influenced by the Forex (Foreign Exchange Market), which also went up,” Pagobo said in a mix of Cebuano and English.

According to a CEDC forecast, electric bills will not go down until the second quarter of 2023.

However, Pagobo said consumers can expect a minimal drop since the price of coal may hover at around US$200 per metric ton.

He said the trend is not only happening in the Philippines but in the whole world.

The City Council committee on energy then asked Pagobo to assign “exceptional” staff to deal with complaints regarding Meco’s so-called “estimated billing” issued by the utility firm when its meter readers cannot do their job due to circumstances like flooding, the presence of dogs near the meters, or when gates are closed, among others.

Pagobo explained that “estimated billings” do not happen every month and the next bill will be adjusted.

Automated meter

Pagobo said Meco is also weighing the possibility of adopting an automated meter reading system which requires massive investment.

If Meco pushes through with the plan, the firm will be forced to raise its distribution rate and 14 meter readers will lose their jobs, he said.

He said the distribution rate will also go up every time the automated system is upgraded which will be every five years.

Meanwhile, the ERC has yet to approve Meco’s contract with San Miguel Global Power Holdings Inc. to supply it with 50 megawatts at the price of P3.33 kilowatt per hour.

This prompted the City Council to pass a resolution urging the ERC to act on the matter.

Rates and bill updates

Pagobo urged consumers to check Meco’s website and to register at their office so that they will know about their electric bills through text message.

Only 25,000 of Meco’s 105,000 consumers have, so far, availed of the service, he said.

Meco was invited to appear before the committee to shed light on numerous complaints regarding the firm’s electric bills in Lapu-Lapu City.