ERC execs return to work
The Energy Regulatory Commission (ERC) will start promulgating decisions on 61 cases, including the reduction on system loss cap, after its four suspended commissioners were allowed to return to work yesterday.
It also vowed to focus on resolving the issue on contract expiration of the power generators.
In a press briefing yesterday, ERC chair and CEO Agnes Devanadera said the agency received the 60-day temporary restraining order (TRO) issued by the Court of Appeals (CA) against the suspension order imposed by the Office of the Ombudsman in December 2017.
The CA issued the TRO “to avoid serious and irreparable disruption in the operation of the ERC and to prevent adverse repercussions on the power industry as a whole.”
“With the TRO issued by the Court of Appeals, the ERC can now resume with the regular performance of our duties and functions and act on petitions with urgency. I’m glad that the CA gave weight to the impact of the vacuum of leadership caused by the ombudsman’s suspension of the ERC commissioners and considered the welfare of the electric power industry stakeholders, most especially the consuming public who will eventually suffer the consequences of the ERC’s inability to perform its mandate,” Devanadera said.
With a quorum, she said the agency can start looking into the pending cases, the biggest of which is the imposition of a new system loss cap.
“The commission has already approved rules on system loss cap. This was not done for just a week. There was an engagement of consultants to study this as well as the conduct of public consultations,” she added.
System loss refers to unbilled power caused by pilferage and physical loss of energy when electricity passes through distribution lines.
Under Republic Act 7832 or Anti-Electricity and Electric Transmission Lines/ Materials Pilferage Act of 1994, this can be passed on to consumers through a line item in their monthly electricity bills although a third-party consultant the ERC tapped in September 2016 proposed to have this lowered.
Currently, the system loss cap is at 8.5 percent for privately owned distribution utilities (DU) and 13 percent for electric cooperatives (EC).
Under the revised system loss cap, ERC commissioner Josefina Asirit said power distributors will be given a four-year transition period to adjust to the lower system loss cap.
She said the system loss cap on DU would be reduced to 6.5 percent and eventually to 5.5 percent, while that of ECs will be lowered to 12 percent and then to 8.25 percent at the end of the transition period.
“We gave them a transition period because they won’t be able to reach the cap immediately. This will allow them to improve on their assets,” Asirit explained.
Apart from the 61 cases, Devanadera said the ERC would also immediately decide on pending or expiring certificates of compliance (COCs) of power generators to enable them to trade on the wholesale electricity spot market (WESM).
As for the controversial Manila Electric Co. (Meralco) petitions, the ERC chief said these would not be approved immediately since the pending cases have to go through the process first.
“There are processes here. Not because you have filed an application, tomorrow we approve. There are processes and we have to make sure the processes are in place and the study is done,” Devanadera stressed.
Meanwhile, the consumer group Power for People (P4P) Coalition was dismayed over the CA-issued TRO, which lifted the suspension of the four ERC commissioners.
The four – Alfredo Non, Josefina Asirit, Gloria Yap-Taruc and Geronimo Sta. Ana – were suspended by the anti-graft office for one year without pay for “delaying the conduct of competitive bidding in securing power supply agreements (PSAs).”