By Lenie Lectura - January 7, 2019
THE Manila Electric Co. (Meralco)
has formally informed regulators of a pressing need to approve its applications
for emergency capital expenditures (capex) while its 2018 and 2019 capex
applications are pending.
According to Meralco Chief Financial
Officer Betty Siy-Yap, the utility firm has manifested an urgency to approve P4
billion in the first half of 2018 and another P4 billion in the second half of
the same year.
“The total amount manifested is
about P8 billion,” the Meralco official said in a text-message reply.
Meralco, which is required to seek
approval from the Energy Regulatory Commission (ERC) before it can implement
its planned capex, has been filing for emergency capex because its main
application for capex has yet to be approved.
Even its applications for emergency
capex have yet to be resolved by the ERC. As such, the utility firm has filed
manifestations before the ERC.
“We manifested most of them because
the projects are critically loaded,” she said, adding that the emergency capex
are vital to finance Meralco’s network.
Meralco’s capex for the third
regulatory year (RY) of its fourth regulatory period (RP) amounting to P18.8
billion still awaits approval of the ERC. The amount covers the period July
2017 to June 2018.
For its July 2018 to June 2019
capex, Meralco filed approval for P21.46 billion. This is also pending.
In all, Meralco’s P40.26-billion
capex application for two regulatory periods remains pending with the ERC.
The proposed capex programs are
necessary to meet growth in peak demand and customer connections; to ensure
sustained network efficiency; to enhance its distribution network; to
comply with regulatory requirements; and support government’s public-private
partnership programs.
Meralco forecasts a 4.5-percent
growth in peak demand and a 3.6-percent growth in customer base. “The
increase…will require Meralco to increase the capacity of the electric
distribution system in order to accommodate customer connections, while
maintaining the reliability and power quality of the distribution system,” it
said.
It also pointed out that capex
projects are required to maintain existing assets, improve network performance
and enhance customer service performance. Moreover, technology projects will
allow it to enhance its distribution network, enabling it to respond
effectively to line and network outages, which will reduce service
interruptions of customers, Meralco said.
It stressed that non-approval of its
capex projects will severely hamper its operations and affect its ability to
deliver electric service to its customers.
“It is imperative for Meralco to undertake
in a timely manner, expansion and rehabilitation of its network facilities
through acquisition of new assets in order to ensure continuous delivery of
reliable service, and comply with safety, performance and other regulatory
requirements, while addressing the growing needs of its more than 6 million
customers,” it said.
customers,” it said.
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