ERC Order Cuts Power Rate by P1

A recent order of the Energy Regulatory Commission (ERC) mandating the charging of the claims for rate adjustments of the National Power Corporation (NPC) against small island grids to the Universal Charge-Missionary Electrification (UC-ME) fund has resulted in a reduction of over P1 per kilowatt-hour.

FICELCO General Manager Samuel Laynes said the cooperative already incorporated the rate reduction in the power billing received by over 40,000 member-consumers for the month of August 2012.

It may be recalled that in December 2011, ERC authorized NPC’s Small Power Utilities Group to recover P4 billion in fuel and foreign current losses partly through an increase of P1.4282 per kilowatt-hour to be applied for four years, or until 2016. The NPC rate increase brought the cost of each kilowatt-hour of electricity on the island to about P12.50 per kWh for residential consumers.

In the province of Catanduanes, power rates increased to as much as P14 per kWh, especially when the cooperative began recovering the real property tax it paid to the local government of Bato. Bato residents shouldered 65% of the RP tax recovery while the rest of consumers in the 10 towns found added to their bill P0.23 per kWh.

Several cooperatives and the APEC partylist, however, filed separate motions before the ERC seeking the extension of the recent deferment of the 4th, 5th and 6th GRAM and ICERA rate increased sought by NPC-SPUG.

In its July 30 ruling which it released on Aug. 24, the Commission deemed it appropriate to allow NPC-SPUG to recover the approvced adjustments through the UC-ME instead of adding it to the Subsidized/Approved Generation Rate (SAGR) charged directly to consumers. It said this would mitigate the impact of the rate adjustment on the consumers within the SPUG areas, as the earlier order brought about an abrupt increase in the SAGR.

The removal of the GRAM and ICERA adjustments from member-consumers’ monthly billings brings power rates to a more affordable P12.32 per kWh for residential consumers, especially with the removal of the RP tax recovery adjustment from the same bill.

Source: Catanduanes Tribune