PSALM wants to recover P1.041B

Business World Online
Posted on June 26, 2014 10:57:10 PM

STATE-OWNED Power Sector Assets and Liabilities Management Corp. (PSALM) wants to adjust generation charges to account for over- and under-recoveries -- totalling P1.041 billion -- that were incurred last year.
Power rates will go up in the Visayas but drop in Luzon and Mindanao under PSALM’s recovery petition.

PSALM, in a June 26 petition, asked the Energy Regulatory Commission to authorize an increase in National Power Corp. (Napocor) rates in Visayas and reductions in Luzon and Mindanao.

The adjustments cover P790.27 million in power purchase costs and P251.02 million in foreign-exchange related costs.

PSALM asked for a five-year recovery period for rates in Visayas, which means a P0.1537 per kilowatt-hour (kWh) increase.

One-year refund periods, on the other hand, were sought for rates in Luzon and Mindanao, equivalent to P1.8449/kWh and P0.2821/kWh, respectively.

PSALM’s petition covers the costs of maintaining the ten state-owned power facilities.

The adjustments used to be implemented via the generation adjustment rate mechanism (GRAM) and incremental currency exchange rate adjustment (ICERA) schemes.

Napocor, through PSALM, started implementing automatic rate adjustments in 2010, with a 12-month review resulting in either a refund or recovery of costs.

The GRAM and ICERA mechanisms are still applied with respect to Napocor customers in off-grid areas. Earlier this month, Napocor sought regulatory approval to recover P1.833 billion under the GRAM and P8.068 million under ICERA.

PSALM was created under the Electric Power Industry Reform Act of 2001 to assume ownership of and manage all of Napocor’s assets, liabilities, contracts with independent power producers, real estate and other disposable assets. -- Claire-Ann Marie C. Feliciano source