By Jose Rodel Clapano (The Philippine Star) Updated September 07, 2011 12:00 AM
MANILA, Philippines - The Freedom from Debt Coalition-Women’s Committee yesterday warned the proposed rate hike filed by the National Power Corp. (Napocor) is part of a series of petitions lined up by Napocor and the Power Sector Assets and Liabilities Management Corp. (PSALM) to fully source from consumers the payments for Napocor’s $17-billion (P729-billion) debt.
Judy Ann Chan-Miranda, of the FDC Women’s Committee, led a picket in front of the Energy Regulatory Commission (ERC) office slamming the petition of Napocor and PSALM as “anti-women” and “anti-poor.”
Miranda said in a society like the Philippines where women are mostly in charge of managing the household budget, higher electricity rates mean additional burden and deeper indebtedness.
She said the most affected are those women who already find it hard to make ends meet.
To symbolize its opposition to the electricity rate increases, the FDC Women’s Committee members brought copies of notice of disconnection from a distribution utility and a caricature of a power meter dramatizing the “Batak-Metro” they experienced.
They called on the ERC to junk the petition of Napocor and PSALM seeking to recover its stranded debts and contract costs amounting to almost P40 billion.
Miranda said the almost P40-billion contract costs translate to 40 centavos per kilowatt-hour which will be collected through the universal charge should ERC approved Napocor and PSALM’s petition.
“High power rates mean women taking on even more work to pay for electricity and have something left for other essentials. It means cutting the budget for food, medicine and healthcare, the education of children. It means having little choice but borrow from loan sharks to avoid disconnection,” she said.
On Aug. 19, the FDC filed an intervention before the ERC citing the lack of merit and substance of Napocor and PSALM’s petitions.
PSALM, Napocor, power retailer Manila Electric Co. (Meralco) and the National Grid Corp. of the Philippines (NGCP) have filed separate petitions for power rate increases before the ERC.
PSALM is seeking an increase of P0.1059 per kilowatt-hour (kwh) for Luzon and P0.1157/kwh for Visayas, and also an adjustment in the universal charge (UC) by P0.39/kwh to recover a portion of the debts of the Napocor, of which P0.03 per kwh will be collected over 15 years to pay for stranded debts while P0.36 per kwh over four years for stranded contract costs.
PSALM has also a separate pending petition to oversee the liquidation of Napocor’s assets to pay off its debts, and in the process lower power rates, for the adjustment of Napocor’s base rate under the Generation Rate Adjustment Mechanism (GRAM) and Incremental Currency Exchange Rate Adjustment (ICERA), where it seeks a hike of P4.72/kwh for Luzon, P4.26/kwh for Visayas and P3.17/kwh for Mindanao.
GRAM recovers the cost of fuel and electricity purchased from privately owned power plants, while the ICERA is a mechanism to recover the state power generator’s foreign exchange fluctuation costs.
Meralco, for its part, has increased its generation charge effective on the August 2011 billing period at P0.08/kwh as a result of higher cost of power from the spot market and power producers.
The same power retailer just got a green light from the ERC to impose another 3.06 centavos/kwh for its under-recoveries during the period of Jan. 26 to Feb. 25 in 2010 amounting to P944 million.
The NGCP, meanwhile, has proposed to the ERC a total rate increase of P0.82/kwh that will be staggered from October 2011 up to December 2015 in Luzon to recoup the P80.2 million used for the rehabilitation, repair and restoration of transmission line facilities damaged by typhoons “Basyang” and “Juan” in 2010.
Sen. Ralph Recto said the impending series of power rate hikes do not jibe with the spirit and intent of the Electric Power Industry Reform Act (EPIRA).
Recto, chairman of the Senate ways and means committee, said he would initiate a probe on the impact on power users already reeling from high prices of electricity and fuel.
“Surely, the looming ‘power rate shockers’ would further validate the country’s reputation as having the highest power rates not only in Asia but also in the whole world, with electricity costing P11 per kwh,” he said.
Recto pointed out the electricity rate adjustments would be passed on to consumers. He said this would be a disincentive to the country’s investors and unnecessarily burden the consumers of electric power who are currently faced with high cost of living.
Recto said an investigation of the Senate on the power rate increase petitions would “energize the chamber with volts of ideas on whether EPIRA suffered a major tripping or a short circuit on its way to implementation.”
Recto called on the Senate to check whether the separate power rate increase petitions lodged before the ERC were in consonance with the EPIRA’s paramount goal of ensuring reliable, cheap and secure supply of electricity.
“If these petitions fall through, all power users – households and industries – would be bracing for multiple power rate whammies where the future electricity billing would display a jump of at least P5 for every kilowatt-hour used,” Recto said.
The EPIRA defines stranded debts as any unpaid financial obligation of the Napocor that has not been liquidated by the proceeds from the privatization of the generating firm’s assets.
On the other hand, stranded contract costs are the excess cost of electricity under eligible contracts over the actual selling price of the energy output of these contracts in the market.– With Christina Mendez
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