Energy chief questions P74 billion electricity subsidies, seeks audit

cusi doe

Department of Energy Secretary Alfonso Cusi is proposed an audit of P74.883 billion worth of collections on universal charge for missionary electrification (UCME), a fee being charged and collected from the monthly electricity bills of all Filipino consumers.

He said that this energy subsidy fund will not just benefit the marginalized consumers but also the owners of resorts and big commercial establishments in island-provinces, citing a departure from the government’s goal in subsidizing consumer households who need financial assistance.

“I proposed for an audit, but there are some sectors already objecting to it,” he mentions.  

Several areas under the Small Power Utilities Group (SPUG) operations of the National Power Corporation (NPC) are just passing on rates ranging from P8.00 to P12.00 per kWh. The actual rate, however, is P14 to P20 pero kWh with the tariff difference then being charged against the UCME.

Depending on the approved tariffs of these island-grinds, the cost being passed on then to all electricity consumers via the UCME line could be in the range of P4.00 to P8.00 per kWh. The total cost is divided among all Filipino consumers and the pass-on cost appears marginal in their billings.

As Cusi observed, household consumers struggling to make ends meet aren’t the only ones benefiting from the subsidies as resorts and hotel operators are also taking advantage.

“In the island-provinces, you have the UCME – the subsidy that people are paying. But even the resorts and malls are entitled to the same subsidy,” Cusi emphasized to Manila Bulletin.

Based on the energy chief’s assessment, businesses are not actually paying the cost because they are passing electricity consumption charges as a component of their service costs.

Distribution utilities and other energy suppliers collect UCME through a separate line item in monthly electric bills. The costs are then remitted to Power Sector Assets and Liabilities Management Corporation (PSALM).

State-run NPC also tapos into the fund for its energization drive of SPUG areas.

UCME collections already reached P74.883 billion as of January this year with additional interest charges accumulating at P44 million, based on PSALM data.

It was further reported that PSALM already disbursed about P74.895 billion, leaving the remaining fund at P32 million.

In January alone, a total of P1.040 billion was already disbursed to NPC-SPUG, PSALM noted.