Meralco bares capex for prepaid electricity

Business World Online
Posted on March 08, 2012 10:43:14 PM


AN INCREASE in interest in prepaid electricity has prompted distribution utility Manila Electric Co. (Meralco) to ask the Energy Regulatory Commission (ERC) to approve the budget for the program.
Meralco is requesting the ERC’s permission to use funds allocated for earlier projects, a few of them geared towards infrastructure, for its prepaid electricity program instead.
“The total cost of the prepaid electricity project is P253.2 million. Given that the proposed project is an unforecasted project, [it] was not factored into the yearly revenue requirement for the third regulatory period, [Meralco] is constrained to substitute some of its approved projects,” Meralco said in its petition.
It added the amount of the approved projects to be substituted is P292.9 million.
The company is pushing for the use of prepaid electric meters as part of its plans to establish a smart grid in the country.
Prepaid electricity allows electricity consumers to pay only for electricity they have consumed and limit their consumption.
Meralco said there is “an 83% level of interest” for prepaid electricity.
To roll out the project, Meralco said it needs to integrate prepaid electricity to its current system.
It plans to integrate the prepaid system to its bayad centers, cellular mobile telephone mobile service, short message service gateway, its point of sale, customer management system, integrated voice recording system and corporate e-mail system.
Meralco already rolled out a pilot program in specific areas of Metro Manila.
It earlier said it plans to spend about P10 billion in capital expenditures this year.
Meralco ended 2011 with a 22.5% growth in its core net income to P14.9 billion from P12.2 billion.
Its reported net income grew 36.6% to P13.2 billion in 2011 from P9.7 billion.
Mediaquest Holdings, Inc., a unit of the Meralco sister firm Philippine Long Distance Telephone Corp.’s Beneficial Trust Fund, has a minority stake in BusinessWorld.
Shares of Meralco closed at P272, up 1.49% from its previous close of P268 apiece. -- Emilia Narni J. David