Consumer group slams higher FIT-All rate

Danessa Rivera (The Philippine Star) - June 16, 2018 - 12:00am

https://www.philstar.com/business/2018/06/16/1824908/consumer-group-slams-higher-fit-all-rate

MANILA, Philippines — Consumer advocacy group CitizenWatch slammed the higher feed-in tariff allowance (FIT-All) rate charged to consumers starting this month, calling it an additional burden to Filipinos amid rising prices.

CitizenWatch said the FIT-All in electricity bill is proving to be an additional burden for Filipino consumers already overburdened by the increase of prices attributable to rising inflation rates, oil price hike in the world market, weakening of the peso against the US dollar and the untimely impact of the Tax Reform for Acceleration and Inclusion (TRAIN).

While Manila Electric Co. (Meralco) announced an overall rate decrease this month, the consumer group said the decline would have been bigger if not for the FIT-All rate.

“The cut could have been higher if not for a P.0733 per kWh (kilowatt-hour) increase in FIT-All rate.” CitizenWatch Philippines convenor Hannah Viola said.

Earlier this month, Meralco announced a P0.1252 per kWh decrease in electricity rates, which translates to a reduction of some P25 in residential customers consuming 200 kWh.

“Instead of enjoying the full benefits of the decrease amounting to almost P0.20 per kWh, consumers are left only with a reduction of P0.13 per kWh,” Viola said.

The FIT-All is a uniform charge billed to all on-grid electricity consumers, reflected as a separate component in their monthly electricity bills, to cover payments to renewable energy developers under the FIT system.

The FIT system details perks for power developers for a period of 20 years to invest in the more expensive renewable sector.

Collections are then placed in the FIT-All fund which is being managed by the National Transmission Corp. (TransCo).

The current FIT-All rate charged to consumers is 25.63 centavos per kWh, which was increased from 18.3 centavos per kWh after the Energy Regulatory Commission’s (ERC) approval.

ERC said the higher adjustment would cover the inefficiency of the FIT-All fund to cover all its obligations, citing that out of the total, renewable energy claim was P40.2 billion. Of the total, only 82 percent has been paid and that 18 percent or P7.38 billion remains unpaid.

CitizenWatch Philippines, however, said the recent increase marks the second time in which ERC approved rates higher than what TransCo proposed, creating an additional burden for ordinary consumers.               

“Insufficiency of FIT payments should not be shouldered by the consumers anymore, who are already suffering as it is. We call on the government to explore other options in addressing the P7.38 billion deficit, to have an immediate review of FIT-All processes and to ultimately find solutions that will help soothe the plight of consumers.” Viola said.

Last year, TransCo filed to raise the 2018 FIT-All collection from consumers to 29.32 centavos per kWh to fully cover the payments backlog and interest to renewable energy developers.