March 20, 2019 | 10:43 pm
THE Energy Regulatory
Commission (ERC) has dismissed for being moot and academic a joint petition
seeking incentives for companies that manage to bring systems losses below a
set level, which was filed by power operators and distribution utilities.
In an order promulgated
on March 14, the ERC said the petition for the regulator to initiate
rule-making by approving proposed guidelines for computing system loss had
already been addressed by the rules approved by the commission in 2017 and
subsequently clarified through a resolution in 2018.
“Thus, the instant
Joint Petition should be declared moot and academic considering that the
Commission had already resolved the issues raised by the Joint Petitioners,”
the ERC said.
The petitioners are the
Private Electric Power Operators Association, Inc, the Philippine Rural
Electric Cooperative Association, Inc., and Manila Electric Co. Their petition
dates to Jan. 27, 2011.
The proposed guidelines
contain the details of the incentive scheme, which calls for the system loss
rate to be calculated and billed each calendar month using the prevailing
system loss cap.
In case the actual
annual system loss level of a distribution utility falls below the prevailing
cap set by the ERC, an incentive scheme to further lower the system loss will
be implemented for the benefit of consumers.
A system loss savings
equivalent to the customer share in the incentives will be reflected as a
separate line item in the electricity bill upon the implementation of the
incentive scheme.
The rate for the
savings is computed by taking the difference between the computed system loss
charge at the cap and the computed system loss charge at the actual 12-month
moving average system loss. The resulting difference is then multiplied by the
customer share in the incentive scheme to arrive at the savings rate per
kilowatt-hour.
The ERC said since the
filing of the petition in 2011, it had adopted rules and resolutions that are
directly related to and responsive to the petitioners’ proposal.
These include rules
issued in 2017 for setting the distribution system loss cap and establishing
performance incentive scheme for distribution efficiency.
In 2018, the ERC issued
a resolution clarifying the system loss calculation and providing the
effectivity of the rules for setting the distribution system loss cap.
In September 2016, the
commission conducted a study on system loss for purposes of establishing the
new caps based on the parameters prescribed under Republic Act No. 9136 or the
Electric Power Industry Reform Act of 2001 (EPIRA). The proposal of the
petitioners were also considered in the study.
The ERC then came up
with proposed rules on distribution system loss based on the EPIRA parameters
and the proposals submitted by the petitioners. The proposed rules underwent
public consultations and legislative hearings in which various stakeholders had
participation in the discussion.
On Dec. 5, 2017, the
ERC approved the rules, but ahead of their publication, some electric
cooperatives requested clarification.
On April 23, 2018, the
commission approved the system loss resolution, which also clarified the
questions raised by the electric cooperatives relating to the previously
approved rules. — Victor V. Saulon
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