ERC orders Meralco to refund P1.4 billion over collection

Danessa Rivera (The Philippine Star) - December 31, 2020 - 12:00am
https://www.philstar.com/business/2020/12/31/2067186/erc-orders-meralco-refund-p14-billion-over-collection

MANILA, Philippines — The Energy Regulatory Commission (ERC) has ordered Manila Electric Co. (Meralco) to refund customers of over collections of P1.4 billion in pass through charges and collect under recoveries of P2.38 billion in generation rate.

“The commission’s initial evaluation of the documents submitted by Meralco revealed that it incurred a total over collection amounting to P1.4 billion in the transmission rate (TR), system loss rate (SLR), lifeline subsidy rate (LSR), and senior citizen subsidy rate (SrCSR), but also incurred a total of P2.38 billion under collection in the generation rate (GR),” ERC chairperson and CEO Agnes Devanadera said.

The amounts were validated based on Meralco’s submitted data for the periodJanuary 2017 to December 2019.

In its order, the ERC directed Meralco to implement its over and under-recoveries, by way of refunding and collecting the same, subject to the final evaluation by the commission.

Starting on the next billing cycle, Meralco should refund the over-recoveries at an average rate of P0.1331 per kilowatt-hour (kWh) for a period of approximately three months.

Meanwhile, the power distributor should collect the computed under-recovery in the GR, with an equivalent rate of P0.0395 per kWh for approximately 24 months until fully collected.

The ERC directed a longer period for Meralco to collect the under charges in order to protect the consuming public by mitigating the impact of the said under-recovery collection.

Meralco was also directed to reflect the over and under-recoveries in the monthly computations of GR, TR, SLR, LSR and SrSR as “OGA” for generation, “OTCA” for transmission, “OSLA” for system loss, “OLRA” for lifeline subsidy, and “OSrRA” for senior citizen subsidy.

The distribution utility (DU) was also required to submit within 10 days from its implementation a sworn statement indicating its compliance with the ERC order.

DUs are required to file their respective applications to the ERC once every three years in order to ensure that the recovery of the said various pass-through costs is fair and proper.

“Let it be emphasized that the Commission, in acting on the pass on charges confirmation has the consumers’ welfare as its primordial consideration. We will find means, such as stretching the collection of any under collection to a longer period and effecting a quick refund for over collection, in order to temper the impact on consumer’s bill,” Devanadera said.