ERC okays leaner Meralco rate hikes

The Energy Regulatory Commission (ERC) has decided favorably on the application of Manila Electric Company (Meralco) to stagger its increased generation charges for March to May, but it had just been set at a leaner R0.2211 per kilowatt hour (kwh) instead of R0.30 per kwh as petitioned for.

The regulatory body noted that it determined leeway for R665 million reduction in the fuel cost charges that were set for pass on over the period – or just to the level of R1.752 billion from what was estimated at R2.417 billion in Meralco’s filing.

ERC Chairman Jose Vicente B. Salazar said this decision manifests their intent at fully “protecting the interest of the consuming public by ensuring that what is billed is reasonable and not excessive without compromising the continuity of electric service.”

Notably, Meralco sought for threemonth pass on of the fuel cost adjustments incurred by its contracted gas-fired power plants on this year’s Malampaya shutdown – supposedly to the tune of R0.32 per kwh in March; and

R0.30 per kwh hike each in April and May billings.

The ERC indicated that their own computation “reflected a lower total fuel cost in the amount of R1.752 billion compared to Meralco’s R2.417 billion, or a difference of some R665 million.”

The regulatory body emphasized that “the amount was lower as the ERC’s calculation made use of the previous month’s actual fuel cost, while Meralco’s computations were based on forecasted fuel cost.”

Following its verdict, the ERC correspondingly directed Meralco “to implement the collection of the incremental fuel cost on a 3-month staggered basis for the billing covering the months of March to May, 2017.”

Electricity consumers have long been cautioned on such rate hike given the fuel shift of the gas plants and the tightening of supply as an offshoot of the gas production facility’s shutdown from January 28 to February 16 this 2017.

The affected plants had been the 500megawatt San Lorenzo and 1,000MW Sta. Rita facilities that shifted fuel use to condensate; and the 1,200MW Ilijan plant which temporarily utilized diesel fuel.

With the scorching weather already nearing, consumers are still pleaded upon to be wise and prudent in their electricity usage as the coming months may still be strenuous when it comes to power supply that may then have overall impact on costs billed to endusers.