A former top official of the Energy Regulatory Commission (ERC) claimed the Manila Electric Co. (Meralco) may cough up or regurgitate as much as P150 billion in customer refunds on top of automatic rate reductions based on a re-computation of its weighted average cost of capital (WACC).
Alfredo Non, former ERC commissioner, in a broadcast interview last week, said his own computations were submitted to the ERC officials for consideration.
Non said his computation included new rates that Meralco may charge customers after the refund is completed.
“Now after the refund is paid, the monthly bill will change,” Non said.
According to the former ERC official, the refund arose from Meralco charging its customers P1.47 per kilowatt hour (kWh) although it had provisional authority to charge no more than P1.38 per kWh.
Non noted Meralco based the high P1.47 per kWh charge on the provisional P1.38 per kWh rate being “only temporary.”
WACC is one of the building blocks to computing power costs under the government’s performance-based regulation in setting utilities rates.
“I started doing my own calculations after my retirement in 2018. After I did the calculations, I submitted it to the ERC. But of course it’s now up to them already,” Non said.
According to the current ERC timeframe, results from the WACC review and reset for distribution utilities, mainly Meralco, should be done by March next year.
But Senate committee on energy vice-chairperson Sherwin Gatchalian said the original ERC-set date to complete the Meralco rate review has already been delayed by more than a year.
Meralco has since said it has demonstrated a willingness to adhere to ERC strictures and that the charges and cost adjustments reflected in consumer bills have been reviewed and approved by the ERC.
