Malampaya funds eyed to compensate Napocor

By Danessa Rivera (The Philippine Star) | Updated August 7, 2016 - 12:00am

http://www.philstar.com/business/2016/08/07/1610735/malampaya-funds-eyed-compensate-napocor

MANILA, Philippines - The Department of Energy (DOE) is looking at using the Malampaya funds to pay for National Power Corp.’s (Napocor) stranded costs and debts, instead of passing on the burden to consumers.

This is part of the agency’s mandate and the Duterte administration’s promise to lower power rates, Energy Secretary Alfonso Cusi said.

“On our part, we are looking at the Malampaya fund to compensate the stranded cost and stranded debts, which are being passed on to consumers. We have to prioritize the welfare of our consumers,” he said.

This is currently being studied by the DOE. However, the agency did not provide details on how much the Malampaya fund is.

In addressing the recent general meeting of the Philippine Rural Electric Cooperative Association Inc., Cusi said power distributors like electric cooperatives need to comply with the provision of the law ensuring the reliable, quality, secured and affordable supply of electricity.

“Let us assure the communities we serve electricity supply 24/7. And let us strive, work hard in finding ways to bring down our cost of power,” the Energy secretary said.

Cusi has vowed to work on securing reliable power supply and aim to achieve lower power rates “in the eyes of the consumers,” which is among the top priorities of the Duterte administration.

Cusi said one way to lower  power costs is to reduce universal charge (UC).

UC is a pass-on rate to consumers to cover the National Power Corp.’s stranded debt and stranded contract costs, missionary electrification and the environmental fund.

Another way of bringing down electricity rates is by removing system loss charges in electricity bills, DOE spokesman Pete Ilagan said.

System loss refers to unbilled power caused by pilferage and physical loss of energy when electricity passes through distribution lines.

Passing on these charges to consumers is allowed under Republic Act 7832, or Anti-Electricity and Electric Transmission Lines/Materials Pilferage Act of 1994.