The Energy Regulatory Commission (ERC) has directed distribution utilities (DUs) in Luzon and the Visayas to impose the generation charge against consumers only on the basis of a final, rather than a preliminary determination of rates from the Independent Electricity Market Operator of the Philippines (IEMOP).
The regulator said this ensures the billings reflect the accurate values corresponding to Wholesale Electricity Spot Market (WESM) purchases.
The regulatory body said since operations were suspended in Luzon and the Visayas on various dates in May, an administered price (AP) and in certain instances, secondary price caps (SPC) have been applied.
“The commission simulated the impact of the AP and SPC application and noted that the PS is still subject to final adjustment. The commission projects that the FS will result in significantly lower WESM charges compared to those indicated in the PS,” the ERC said in a statement.
The Manila Electric Co. (Meralco), the country’s largest distribution utility, quickly complied with the ERC mandate.
“Meralco will comply with this directive and will wait for IEMOP’s adjusted billing before computing the final rates for June and issuing the bills to our customers,” said Joe Zaldarriaga, Meralco spokesperson and vice president for corporate communications, in a separate statement.
“With this, we also advise our customers to expect a slight delay in the delivery of their bills. We would like to give the assurance that these efforts are meant to mitigate the impact of the expected rate increase to all our customers,” Zaldarriaga said.
Meralco also said that to cushion the impact of the rate increase on customers, it has coordinated with suppliers to defer a portion of their generation costs.
Zaldarriaga said the deferred costs are proposed to be collected on staggered basis for three months or from June to August and that the ERC had no objections over the proposed mitigating measure.
Earlier, Meralco warned consumers of higher charges in its franchise area due to higher pass-through charges.
Among charges expected to rise include the transmission charge following the partial lifting of reserve market settlement as ordered by the ERC, the increase in feed-in tariff allowance as well as the anticipated increase in WESM charges.
