DOE seeks to limit pass on charges to customers

The Department of Energy (DOE) is looking to limit what power distributors can pass on to customers in line with the agency’s bid to reduce the burden of high electricity costs to consumers.

The agency is drawing up a circular that will lay down the rules on what private distribution utilities (DUs) and electric cooperatives (ECs) can charge to consumers, DOE Secretary Alfonso Cusi said.

“We are crafting policies on the pass through expenses of DUs and ECs so we can define and limit what they can charge to consumers,” he said.

The energy chief said the proposed policy should encourage DUs and ECs to im- prove efficiency in their operations.

In drafting the rules, Cusi said the DOE is studying what are being passed on and what can be charged to customers.

He cited the case of Central Negros Electric Cooperative (Ceneco), which provides electricity service to the cities of Bacolod, Silay, Bago, Talisay and the municipalities of Salvador Benedicto and Murcia, to collect P232 million from its customers.

The amount will mean an increase of P0.8 per kilowatthour (kwh) over 50 months in the electricity bills of its customers.

The collection was approved by the Energy Regulatory Commission (ERC) as payment to Kepco-Salcon Power Corp. for the recovery of the 24-megawatt (MW) unpaid unaccepted contract from July 26, 2011 to Nov. 25, 2013.

In a report, Ceneco president Roy Cordova has stopped the management from collecting the pass-on charge since the increase in electricity rates will not be beneficial to consumers. Cusi said the pass through expenses like inefficiencies and negligence in contracting power supply should not be passed on to consumers.

“Who is paying for over contracting, for example? It’s the consumer. It’s their inefficiency but why are they passing the burden to consumers?” he said.