The Energy Regulatory Commission (ERC), in its recent report to the House of Representatives, disclosed that it directed distribution utilities (DUs), both privately-owned and electric cooperatives, to refund their respective customers around Php20.1 billion.
The said amount represents discounts granted to customers, the Market Transaction Fee refund, and over-recoveries in the pass-through and Distribution Charge from 2020 until present.
As a result of the ERC’s directive, electricity customers experienced rate reductions this year of up to Php1.5064 per kilowatt-hour (kWh) in Luzon, Php0.5719/kWh in the Visayas, and Php0.4348/kWh in Mindanao.
Last year, DUs in Luzon and Mindanao rolled back their rates by up to Php0.9118/kWh, while those in Visayas reduced theirs by Php1.3182/kWh.
The Manila Electric Company (MERALCO) particularly refunded Php0.1528/kWh or a total of Php13.9 billion, while the Cagayan Electric Power and Light Company (CEPALCO) refunded PhP0.0268/kWh.
MERALCO, the country’s largest DU, serves Metro Manila; the entire Cavite, Rizal, and Bulacan; eastern Pampanga; western and southern Laguna; western Quezon; and parts of Batangas. CEPALCO, meanwhile, serves parts of Cagayan De Oro City, Tagoloan, Jasaan, and Villanueva, all in Misamis Oriental.
The ERC said it has established a systematic confirmation process of pass-through charges to ensure appropriate recovery of the various pass-through charges in an efficient manner, and that these periodic adjustments are implemented properly in accordance with the approved automatic cost adjustment mechanisms.
Under the Implementing Rules and Regulations of Republic Act 9136 or the Electric Power Industry Reform Act (EPIRA), the ERC is authorized to require report or documents from the electric power industry participants. In line with the said mandate, the ERC adopted the Uniform Reportorial Requirement in 2010, which served as the monthly reportorial submission of the DUs.
The said submission is being reviewed by the ERC to determine any over or under collection incurred by DUs by confirming the rates charged to their respective customers. Any over or under collection incurred by the DUs are either being refunded or collected upon the commission’s approval.
“The PhP20 Billion refund that the [commission] approved is aimed to provide some rate relief, especially to those electricity consumers that were economically disadvantaged due to the limited operation or closure of some businesses. As the COVID-19 continues to persist, we urge the DUs to exercise empathy by allowing a more flexible form of payment of their customers’ electricity bill, such as through staggered payment without penalties or interests,” ERC Chairperson Agnes Devanadera said in a statement.
“The ERC is finding ways to reduce the charges being billed by the DUs to their customers, such as the temporary suspension of some charges like the Bill Deposit Adjustment, Universal Charge and [Feed-in Tariff] Allowance, when appropriate, to alleviate the poverty caused by this pandemic,” she added.