ERC orders MERALCO to refund Php7.76B to customers

ERC merlaco

The Energy Regulatory Commission (ERC) has ordered the Manila Electric Company (MERALCO) to refund a total of Php7.76 billion to its residential customers beginning this month. 

The order – issued on March 8, but only made public last Friday – follows MERALCO’s request for interim relief following the recomputation of the company’s regulatory asset base (RAB) covering 2012 to 2015, which resulted in over-recovery or over-collection in that period. 

“For purposes of the grant of the interim relief, the Commission consolidated the evaluation of the instant [maximum average price] Applications cases filed by MERALCO for [regulatory years] 2012 to 2015 for the 3rd Regulatory Period (RP) for a simplified evaluation thereof for the benefit and interest of the consumers,” ERC said in its order. 

In evaluating the said issue, the ERC considered the principle of full recovery of prudent and reasonable cost as required under Republic Act 9136 or the Electric  Power Industry Reform Act (EPIRA).

“With the re-computation of the opening RAB for the 3rd RP of MERALCO, the Commission conducted further review in relation to the inflationary considerations and assumptions regarding the RAB incorporated in the calculations used in the 3rd RP,” the order further read.

As a result, each MERALCO residential customer will be entitled to a refund amounting to Php0.47 per kilowatt-hour (kWh), which is equivalent to Php93 for those consuming 200 kWh monthly, said MERALCO Vice President for Communications and spokesman Joe Zaldarriaga. 

The refund will be implemented for a period of 12 months, beginning with the May power bills. 

However, consumer advocacy group Power 4 People Coalition found the refund and its duration as an unwelcome development.

“[This refund], along with the fact that MERALCO is allowed to take its sweet time returning it over a one year period, is an insult to consumers. We cannot allow ERC, headed by outgoing chair Agnes Devanadera, and MERALCO to go on with this ploy unscathed. May they consider themselves warned that consumers will fight back against this injustice,” P4P said in its statement. 

During the Holy Week, P4P protested against MERALCO after the power giant announced a rate hike for its April billing.