ERC to Meralco: Customers entitled to additional refund

BY LENIE LECTURA – MARCH 14, 2022
from Business Mirror

The Energy Regulatory Commission (ERC) has ordered the Manila Electric Co. (Meralco) to refund its customers an additional P4.8 billion after it recomputed the utility firm’s Actual Weighted Average Tariff (AWAT).

The total amount of P4,837,163,842 is equivalent to an average refund rate of P0.1064 per kilowatt hour (kWh), which shall be refunded to its customers beginning the billing cycle immediately after receipt of the order, which was promulgated last March 7 and published on the ERC website over the weekend.

“The Commission’s recalculation of the AWAT resulted in a difference of P0.0067 per kilowatt hour (kWh) from the provisionally approved AWAT amounting to P1.4414 per kWh. Likewise, the same recalculated AWAT showed a variance of P0.0671 per kWh from Meralco’s approved Maximum Average Price (MAP) amounting to P1.3810 per kWh.

In consideration of the difference and variance, an additional refund of P4,837,163,842.00, or an average rate of P0.1064 per kWh over a 12-month period to the customers of Meralco is deemed in order, covering the period December 2020 to December 2021,” said the ERC in its 23-page decision.

The ERC told Meralco to reflect the refund rate as a separate line item in the electricity bills. Of the total refund amount, P3,036,678,482 or P0.1923 per kWh, will go to residential & general service A customers; P275,583,867 or P0.1262 per kWh, for general service B; P1,467,808,456, or P0.0549 per kWh; P20,222,542, or P0.0812 per kWh for government hospitals, metered street lights and charitable institutions; P27,156,139, or P0.1999 per kWh for flat streetlights; and P9,714,356, or P0.0255 per kWh for generator-wheeling.

“The immediate implementation of additional refunds to Meralco consumers is appropriate and timely. Moreover, the Commission, given its lawful mandate to protect the welfare of consumers, must exhaust all acts and remedies available to lessen the impact of the pandemic upon consumers. This supplemental order, in the form of interim relief, is a positive measure to ensure the consumers are assisted in a timely manner and with due regard to their interests,” it said.

It can be recalled that in February last year, the ERC directed Meralco to refund P13.89 billion in over-recoveries based on its AWAT from July 2015 to November 2020. The amount is equivalent to an average of P0.1528 per kWh and was returned to customers in 24 months.

“The Commission, based on its initial evaluation of the application and all the information now available, including the data reflected in Meralco’s recently submitted Uniform Reportorial Requirement for the year 2021, the Commission determined that it is but proper, and beneficial to consumer, to expand the period covered by the refund to include December 2020 to December 2021.

This additional period covered by the refund is well within the coverage of the lapsed period affected by the regulatory lag,” said the ERC.