Meralco rate hike petition to be decided next week

By Danessa Rivera (The Philippine Star) | Updated March 3, 2017 - 12:00am

http://www.philstar.com/business/2017/03/03/1677365/meralco-rate-hike-petition-be-decided-next-week

MANILA, Philippines - The Energy Regulatory Commission (ERC) will decide next week on Manila Electric Co.’s petition to stagger this month’s rate hike.

In a phone interview, ERC chairman Jose Vicente Salazar said Meralco’s application is tabled for approval in a commission meeting on Monday.

He said the commission is still waiting for pertinent documents to finally come up with a decision.

Salazar said it would be the top priority in the commission meeting so it can be included in Meralco’s next billing.

The decision to approve Meralco’s petition should be studied carefully, Sen. Sherwin Gatchalian said in another interview.

“Let’s give ERC some time to study that. It is their responsibility… ERC plays such a crucial role and we know how technical this is, so the time they’re asking for is justifiable,” the lawmaker said.

To minimize the burden on consumers, Meralco has proposed to stagger the implementation of the expected power rate hike starting March until May, following the maintenance shutdown of the Malampaya gas field.

Meralco’s overall rate for the March billing is expected to increase by about P0.9174 per kilowatt-hour (kwh).

The power distributor has proposed to impose a generation charge of P0.30 per kwh in March and April, and the remaining balance in May 2017.

In its petition, Meralco said natural gas plants would be running on alternative fuels which are more expensive than the gas being supplied by the Malampaya natural gas facility, which underwent maintenance from Jan. 28 to Feb. 16.

Natural gas fuel only costs around P4 per kwh and using replacement fuel, such as diesel, would double costs to P6 to P8 per kwh.

The Malampaya gas project supplies fuel to around 40 percent of gas-fired plants in Luzon, namely the Ilijan, Sta. Rita, San Lorenzo, San Gabriel and Avion plants—which supply 3,211 megawatts (MW) to the Luzon grid.

Among the natural gas plants, Ilijan Unit 2, Sta. Rita, San Lorenzo and Avion plants ran on alternative fuel to continue operation and generate electricity during the maintenance period.