ERC to come out with real pricing for December ’13 Meralco transmission rate “soon”

February 24, 2014 7:54 am 

MANILA, Feb 24 — The Energy Regulatory Commission (ERC) will “soon” come out with the correct pricing for the December 2013 rate of the Manila Electric Company (Meralco), Energy Secretary Carlos Jericho Petilla said.

The Energy chief, declined, to give further details but stressed that the ERC computation “should be fair.”

Transmission charge of Meralco within October-November 2013 bill is P 5.66 per kilowatt hour but it registered a record-high P 3.44 increase the following month to P9.11 because of higher cost required by power producers from Meralco.

Including transmission charges, taxes and others like system loss, the increase that will appear on the electricity bill of a household consuming 200 kilowatts per month, which is the most number of Meralco consumers, is P 4.15 per kilowatt hour.

“Logic dictates that these are not the proper prices,” Petilla stressed.

The higher transmission charge asked by power generators came about after the one-month maintenance shutdown of the Malampaya gas-to-power project, specifically done for its platform, from mid-November to December last year.

The shutdown limited the supply sourced from the power project. This was aggravated by unscheduled shutdown of several power generators during the same time.

Because power supply was limited that time, most power generators used more expensive fuel to run their power plants, thus, they incurred higher expenses.

The DOE, ERC and the Philippine Electricity Market Corporation (PEMC) have conducted an investigation on the issue.

DOE, in a filing with the Supreme Court in line with the case filed by several groups questioning the process done by ERC before it approved the Meralco rate hike, said a maximum of 2,085 MW was not offered at a certain hour during the Malampaya shutdown.

Power generators are required to offer maximum capacity to the spot market to prevent them from withholding capacities. This is known as the must-offer rule (MOR).

Petilla said there are about 36 power generators that did not offer capacities at a certain hour in the latter part of 2013, which made capacity low and resulted to price spike.

He said the power generators have their respective reasons for not heeding the MOR rules or for under-offering. But whatever the reason is, Petilla said some entities will be reprimanded once the investigation on this issue is done. (PNA)

LAM/JS/JSD

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