Thursday, June 2, 2011

Lifeline subsidies to end soon unless Congress acts

Business World Online
Posted on June 02, 2011 11:51:08 PM

MARGINAL POWER USERS could see their electricity bills shoot up unless Congress approves the extension of a subsidy scheme scheduled to lapse later this month.

The so-called lifeline subsidy provision of the Electric Power Industry Reform Act (EPIRA), said to benefit some 4.4 million families, will expire on June 26.
Congress only has three session days, or until Wednesday next week, to pass a law extending the discount scheme. Relevant bills were passed at the committee level last week but these still have to be approved by both the House of Representatives and Senate, reconciled by a bicameral committee, and again ratified.
The 15th Congress’ first regular session is scheduled to end on June 9 and legislators will only go back to work on July 25.
Energy Regulatory Commission executive director Francis Saturnino C. Juan said regulators would be looking for a "policy guideline from the Joint Congressional Power Commission (JCPC) whether to implement an abrupt discontinue (sic) of subsidies or a gradual phase out."
"[Removing the discounts] would represent a rate shock to lifeline consumers who have enjoyed a 100% subsidy," he added.
A JCPC official said they could recommend a temporary two-month extension if a bill is not approved and ratified.
"Just in case the bill does not pass before we adjourn, we will recommend that the subsidy be extended for two months until we come back from recess," said Senator Sergio R. Osmena III, co-chairman of the JCPC.
At the House, Batanes Rep. Henedina R. Abad, said that "under the EPIRA, the ERC has the power to extend the subsidies for one year if they see it necessary for public interest."
Lawmakers said they remained confident a bill would be passed since the extension was this week certified as urgent by President Benigno S.C. Aquino III.
"I will not worry. Senate leaders are committed to passing this bill before Wednesday," Mr. Osmeña said.
House Speaker Feliciano R. Belmonte, Jr. also said, "It will definitely pass before Wednesday, our last session day."
In Malacañang, Deputy Spokesman Abigail D. Valte said in a text message: "We will be happy to sign [the extension bill] as soon as it is transmitted to us."
Under the current lifeline structure, customers consuming 0-20 kilowatt-hours (kWh) a month get a discount of 100%. The markdown drops to 50% for those using 21-50 kWh, 35% for those using 51-70 kWh, and 20% for those consuming 71-100 kWh.

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