Amidst rising fuel costs, the National Power Corp. (NAPOCOR) has proposed an increase in power rates in off-grid areas, which could lead some households to pay up to Php 9.7068 per kilowatt-hour (kWh), a 17.54% hike in the electric bill.
The Energy Regulatory Commission (ERC) announced public hearings until October to review NAPOCOR’s proposed new subsidized approved generation rates (SAGR) for at least 13 small power utilities group (SPUG) areas.
Philippine Daily Inquirer reported that NAPOCOR, operating over 281 mostly diesel-fired SPUG power plants, had filed for new 2024 rates two years ago, approved by the ERC for implementation in January this year.
In November 2023, NAPOCOR sought even higher rates, aiming for potential hikes of up to 33.36% or around Php 11.0128 per kWh for commercial and industrial customers.
NAPOCOR currently adopts the same rates for residential and commercial/industrial customers. However, NAPOCOR argues that the current generation rate (SAGR) is still not optimized for efficient operations in missionary areas.
The ERC’s Generation Rate Adjustment Mechanism empowers NAPOCOR to adapt rates in response to fluctuating fuel prices and foreign exchange rates.
Moreover, the ERC will determine schedules to assess compliance and present evidence for the proposed rate adjustments.
NAPOCOR’s missionary electrification programs for off-grid areas, funded through the ERC-approved universal charge for missionary electrification, aim to provide reliable power to underserved communities.
