Groups push probe on Quezon plant’s generation charges

posted October 29, 2020 at 08:15 pm by Manila Standard Business
https://manilastandard.net/business/power-technology/338133/groups-push-probe-on-quezon-plant-s-generation-charges.html

Consumer and non-government organizations asked the government to investigate the alleged high generation charges passed on by Quezon Power Philippines Ltd. to Manila Electric Co.’s consumers.

Matuwid na Singil sa Kuryente Consumer Alliance Inc. convener David Celestra Tan and Bayan Muna chairman Neri Colmenares said in a statement that based on the computation of their analysts, QPPL’S generation charges should have gone down because of lower coal prices.

“There is a lot that needs to be explained in the Quezon Power charges that are passed on to the consumers. In January, its rate was P6.5919 per kwh [kilowatt-hour]. Inexplicably, it went up higher instead of lower to P6.723 per kwh despite coal prices coming down by 28 percent during that period,” Colmenares said.

He said this should be investigated by Congress or the Department of Energy and the Energy Regulatory Commission.

QPPL, controlled by Egco Group of Thailand, owns the 460-megawatt Mauban coal-fired power plant in Mauban, Quezon.

Celestra-Tan said QPPL’s pricing mechanism and indexing and coal procurement should be looked at as the company allegedly charged 9 percent to 12 percent higher generation charges than the other coal plants this year.

“If coal goes down, the generation rate should come down if not immediately, at least in the following months,” he said.

Meralco, however, assured that its retail rates went down to the lowest level in years.

Meralco said the average generation charge declined as a result of the implementation of the power supply agreements which were concluded under the competitive selection process in December 2019, the force majeure claims of Meralco against its power suppliers which totaled P2.4 billion as of end-September, lower Wholesale Electricity Spot Market rates, the appreciation of the Philippine peso against the US dollar and lower fuel prices.

“In fact, at around P8 per kilowatt-hour, it has already gone down by almost P1 per kwh on a year to date comparison. The generation charge on the other hand has dropped by 17 percent during the same period last year as a result of our newly implemented power supply agreements which took effect last year,” Meralco spokesman Joe Zaldarriaga said earlier.

“All our supply agreements, including the rates therein, have undergone public hearings participated in by various groups. It is duly and legally approved by the regulator and has fully complied with lawful requirements,” Zaldarriaga said. Alena Mae S. Flores

He said Meralco’s pass-through charges also undergo confirmation hearings by ERC.