Monday, March 3, 2014

Meralco dunned for P1.5b in ‘refund’ to consumers

Manila Standard Today

By Christine F. Herrera | Mar. 03, 2014 at 12:01am


HOUSE leaders on Sunday lambasted the Manila Electric Co. for owing its customers P1.5 billion in refunds from 10 years ago while trying to collect P21 billion from them through higher power rates that the Supreme Court prevented them from charging.
“The problem with Meralco is that while it has been quick to distribute profits to shareholders by way of hefty cash dividends, and swift to jack up rates to the detriment of customers, the company tends to dawdle when it comes to repaying consumers,” House Deputy Minority Leader Arnel Ty said.
In House Resolution 882, Ty urged the House committee on energy to inquire into Meralco’s failure to fully comply with the Nov. 15, 2003 Supreme Court ruling for the company to give back to its customers some P30.2 billion in excess charges.
The overcharges stemmed from Meralco’s practice of passing off its corporate income taxes to its 5.2 million customers, which the Court disallowed.
“We were told that up to now, or more than 10 years later, Meralco has yet to refund at least P1.5 billion to about 260,000 customers,” Ty said.
Ty speaks for the minority bloc in the House committee on energy, and represents the Liquefied Petroleum Gas Marketers’ Association in Congress.
In an interview over radio dzBB, Oriental Mindoro Rep. Reynaldo Umali said every centavo per kilowatt-hour that Meralco wants to charge its customers translates to P9 billion a year at the P4.15 per kWh it seeks to impose.
Umali said Meralco would rake in another P12 billion for the P5 per kWh increase it seeks due to the Malampaya shutdown, bringing its impending windfall to P21 billion.
Umali, chairman of the House committee on energy, said his panel would compel the government to explain its approval of the “unreasonable” rate hike that the Meralco seeks to impose and pass on its customers.
Ty’s LPG-MA has been batting for stronger government supervision of the LPG sector and all energy markets, so as to reinforce consumer protection against potentially unfair trade practices and pricing abuses.
Ty filed his resolution shortly after Meralco came under more fire from consumer groups, this time for including the P4.15-per-kilowatt-hour rate hike in the February billing statements sent to customers.
Both the Department of Trade and Industry and the Energy Regulatory Commission (ERC) have already ordered Meralco to explain why the December rate increase, the subject of a temporarily restraining order from the Supreme Court, still found its way into consumers’ bills.
“We’ve examined Meralco’s February billing statement, and it definitely appears confusing and deceptive,” Ty said.
The DTI urged Meralco customers “to pay only the current amount due for February and to disregard the total amount due” that is inclusive of the P4.15-per-kilowatt-hour upward rate adjustment.
Meralco says it must increase its rates because it had to buy electricity at a higher cost when the Malampaya gas platform and other power plants shut down.
Ty invoked the Consumer Act in pushing for an inquiry into Meralco’s delayed compliance with the refund.
Meralco raked in a cumulative P48.733 billion in net profits from 2008 to 2012, and generously rewarded shareholders a total of P40.638 billion in cash dividends from 2009 to 2013, according to a Philippine Stock Exchange filing.
The country’s largest electricity distributor also earlier reported some P43-billion in inappropriate retained earnings. This suggests that after already paying out P40.638-billion in cash bonuses to shareholders, the company still has an extra P43 billion available for additional dividend payments.
Stock market analysts see Meralco reporting an incremental net profit of P19.409 billion in 2013 and P21.189 billion this year.
The Presidential Communications Operations Office Secretary Herminio Coloma said the Palace would wait for the Court’s decision on the rate increase.
“It is possible that the Court may also refer to its 2003 decision in addressing the current issue,” Coloma said. – With Joyce Pangco Pañares   source

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