PSALM seeks 26.89¢/kwh rate increase for Napocor

The National Power Corp. (Napocor), through the Power Sector Assets and Liabilities Management Corp. ( PSALM), is seeking regulatory approval to recover fuel and purchased power costs.

In a newspaper advertisement, state- run PSALM has applied for a 26.89- centavo per kilowatt- hour (kwh) price rate increase for Luzon, 12.33-centavo per kwh hike for Visayas and 4.48 centavos per kwh price cut for the Mindanao grid.

The Energy Regulatory Commission (ERC) said PSALM filed an application of its “true-up adjustments of fuel and purchased power costs and foreign exchange-related costs.”

“The instant application covers the billing period March 2011 until December 2011,” ERC said.

PSALM said additional rates will allow it to recover its expenses last year.

ERC said PSALM wants to recover P2.199 billion of costs from consumers in Luzon and P1.649 billion from the Visayas. But the state-owned firm plans to implement a refund of P1.736 billion to customers in the Mindanao grid.

To date, effective rates of Napocor are P5.704 per kwh for Luzon, P4.5827 per kwh for Visayas and P2.9744 per kwh for Mindanao.

The true- up adjustments will be implemented for five years for Luzon, Visayas and Mindanao, PSALM said.

“[PSALM] prays for the issuance of a provisional authority to implement the true- up adjustment to improve its financial standing, allowing it to efficiently comply with its mandate under the Electric Power Industry Reform Act ( EPIRA) to liquidate all of Napocor’s financial obligations and stranded contract costs in an optimal manner,” ERC said.

The ERC, for its part, scheduled a public hearing for the petition on June 27 for Luzon, July 2 for Visayas and July 17 for Mindanao.

ERC is the state- owned regulator of the power sector while PSALM is the state agency created by the 2001 Electric Power Industry Reform Act to privatize government power assets as well as manage power plants and debts of Napocor. It buys the fuel requirements of state- owned power plants.

After the privatization of its power facilities, Napocor would be left with the function of operating the power generation in off-grid areas and those power plants that will not be sold by PSALM.