ERC issues refund order to 12 power distributors
By Victor V. Saulong – July 12, 2019 | 7:55 pm
from Business World
THE Energy Regulatory Commission (ERC) has issued orders to privately-owned power distribution utilities (DUs) directing them to refund customers on the unused “regulatory reset cost” including any remaining amount from the previous regulatory period plus interest.
“The Commission has ruled that regulation should be at the cost of the government, and we will consider the same ruling in our current review of the regulatory reset process,” said ERC Chairperson and Chief Executive Officer Agnes VST Devanadera in a statement on Friday.
Under the commission’s performance-based regulation (PBR) methodology, privately owned DUs are allowed to charge regulatory reset cost in their revenue requirement. The regulatory reset cost represents expenses incurred in engaging regulatory experts or consultants when setting and updating the DU’s electricity rates.
“We enjoin the privately-owned DUs to submit a report to the Commission on their compliance with our refund directive on or before 15 August 2019,” Ms. Devanadera said.
The private DUs that were ordered to refund and their corresponding refund amount plus interest are as follows:
1. Cabanatuan Electric Corp. — P602,070 or P0.0309 per kilowatt-hour (kWh)
2. Clark Electric Distribution Corp. — P583,434 or P0.0133/kWh
3. Dagupan Electric Power Corp. — P1,277,538 or P0.0422/kWh
4. La Union Electric Co. — P85,038 or P0.0058/kWh
5. San Fernando Electric Light and Power Co. — P1,395,821 or P0.0252/kWh
6. Tarlac Electric, Inc. — P897,685 or P0.0258/kWh
7. Bohol Light Company, Inc. — P277,684 or P0.0264/kWh
8. Cagayan Electric Power and Light Co. — P5,098,534 or P0.0556/kWh
9. Cotabato Light and Power Co. — P949,743 or P0.0694/kWh
10. Davao Light and Power Co. — P262,640 pr P0.0013/kWh
11. Iligan Light and Power Co. — P558,830 or P0.0274/kWh
12. Visayan Electric Company — P8,885,965 or P0.0447/kWh
The ERC earlier computed the regulatory reset cost to be refunded by Manila Electric Co. (Meralco), the country’s largest DU, at P0.0731 per kWh in July.
Based on ERC’s calculation, the regulatory reset cost refund ranges from P0.04 to P0.08 per kWh.
The commission said distribution utilities will be directed to submit a report on their compliance with the ERC’s particular refund directive, which is subject to audit and review in the next regulatory reset to determine if further refunds are needed.
Ms. Devanadera has said that the amount collected as regulatory reset cost for the past regulatory period remained unused since the 17th Congress appropriated funds for purposes of regulatory reset.
The commission thus deemed it prudent to refund the amounts collected by DUs for this purpose, she said.
The ERC has advised power consumers of private DUs to check their electricity bills next month and find out if the regulatory reset cost refund has been effected, including any relevant interest earned thereon.
