Meralco’s New Rate Hike Stalled; ERC Is Yet To Decide

by Marya Salamat

MANILA – While the implementation of Manila Electric Co.’s historic rate hike (nearly P10 or $ 0.23 in total) is awaiting the decision of the Supreme Court, the company announced this Monday a P0.45- per-kilowatt-hour (kWh) reduction in electricity bills for March. The cut is attributed to a P0.33- per-kWh decrease in this month’s generation charge, or the cost of electricity bought and distributed by Meralco to its 5.5 million customers.

It is the second month that the generation charge registered a reduction, following public outcry against Meralco’s November-December historic rate hike. The implementation of the first tranche (P4.15/KwH) of the rate hike has been temporarily suspended by the Supreme Court since December.

 

But even with Meralco’s rate cut by less than half a peso, it still remains under fire as critics continue to oppose its moves to get its historic rate hike implemented. Meralco has been petitioning the Energy Regulatory Commission to allow it to increase its rate by more than P5 ($0.11), saying the second tranche of its total demanded rate hike was not covered by the high court’s TRO. The company also caused confusion among customers after it included in its bill for the past month the SC-frozen hike.

Against these moves by Meralco, members of POWER (People Opposed to Unwarranted Electricity Rates) held a picket in front of the building housing the office of the Energy Regulatory Commission (ERC). Shortly after the picket, some of their representatives went up to the ERC office to submit a petition for intervention. They asked the ERC to oppose Meralco’s demanded P5.33/KwH ($ 0.12) rate hike.

Meralco’s historic rate hike “obviously baseless”

The P5.33 ($ 0.12) “provisional” rate hike being demanded by Meralco is being described as baseless and too burdensome.

“We appeal to the ERC to fulfill its mandate of protecting electricity consumers. At the very least they should await the SC ruling on Meralco’s P4.15 rate hike since the new P5.33 ($ 0.12) rate hike is based on the same factors,” said Teddy Casiño, POWER convener and former Bayan Muna representative.

POWER believes Meralco and its supplier, the Aboitiz-owned Therma Mobile, acted deliberately in artificially jacking up prices in the Wholesale Electricity Spot Market (WESM) even after the Malampaya shutdown last November to December.

In its petition, POWER shared the results of its investigation, which revealed that Meralco, through Therma Mobile, made at least four bids “in the fantastic amount of P62 in November 2013 which led to the P4.15 hike.”

In December, Therma Mobile reportedly made at least 16 bids of P62 ($1.40), one of it happened on Dec 11, 2013, two days after the end of the Malampaya shutdown.

With the controversy and subsequent outcry surrounding the unprecedented maximum bid price of P62 ($1.40), (the average rate in WESM is pegged at P11/KwH or $0.25), especially when the P62 bid was successfully dispatched for the first time, the energy department later ordered the WESM price cap lowered by almost half to P32 ($0.72).

This, and the subsequent buck passing between Meralco and power generators indicate collusion, according to Casiño. “It is clear that Meralco, WESM and Therma Mobile manipulated the bidding at the spot market.”

Casiño added that the ERC should have rejected outright the Meralco petition for the unprecedentedly high rate hike considering the questionable bases.

In a dialogue, ERC executive director Francis Saturnino C. Juan – who said he left a meeting to talk with the POWER petitioners – said the ERC will not yet act on Meralco’s petitioned P5.33/KwH ($ 0.12) rate hike.

“The petition submitted by Bayan Muna will be considered in the holding of hearing on Meralco’s petition to increase rate based on their generation charges,” Juan said.

But he did not rule out a rate increase. In Filipino, he said they in “the ERC could not yet say that there will be no rate hike because the amount (of increase) has not yet been determined.” (bulatlat.com)

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PHOTO CAPTION

POWER petitioners show copy of latest submitted petition for intervention on Meralco’s latest attempt to hike rates. (bulatlat.com photo)

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