27 July 2007
AMID the reported “red alert” in the power sector, around a hundred Meralco consumers belonging to the Freedom from Debt Coalition trooped to Meralco Branch in Kamuning, Quezon City Friday morning to condemn the P1.25/kWh increase in their electric bill this month.
“We are enraged by this new power rates increase and we blame Meralco, the Energy Regulatory Commission, and Gloria Arroyo for aggravating our sufferings. Because of the increase, we have to find an additional P400, for us consuming 250 kWh a month, in order to pay our electricity bill,” said FDC Vice President Wilson Fortaleza.
The generation charge increased from only P4.42/kWh to P5.67/kWh beginning June-July billing of Meralco following the automatic generation rate adjustment (AGRA) resulting from the approval by the Joint Congressional Power Commission on June 21 of the Implementing Rules and Regulations of the Electric Power Industry Reform Act (EPIRA) that allowed automatic cost recoveries by the utilities. The increase in generation charge also increases the value added tax in generation.
Before the implementation of AGRA, consumers had the opportunity to know or scrutinize the application of Meralco for rates adjustments for recoveries of costs such as purchased power, fuel, exchange rate, and systems loss. Now, by allowing automatic cost recoveries, subject for review only by the ERC after the adjustment was implemented, the due process is lost as well as the transparency.
Fortaleza explained that the recent increase is equivalent to what Meralco applied for in its Oct26-Nov25, 2006 petition. “But there are many questions surrounding it. In the first place, we believe that Meralco’s increased generation costs cannot be passed on to its customers because it sourced its electricity from the wholesale electricity spot market which sold more expensive electricity. This is a violation of the economic supply obligation under Section 23 of EPIRA which states that ‘a distribution utility shall have the obligation to supply electricity in the least cost manner to its captive market, subject to the collection of retail rate duly approved by the ERC,’” added Fortaleza.
The WESM average generation cost amounts to approximately P6.60/kwh versus those from the bilateral contract with Napocor amounting to a lesser amount of P4.36/kwh.
FDC members poured a sack of charcoal in front of the Meralco branch and put on top of it a charcoal-powered flat iron. “The increase is anti-people. We are now compelled to use a form of energy as a substitute to electric power. We know that charcoal is harmful to our health and to our environment. But we are forced to use it, cheaper than electricity, so we can press our clothes and cook our food because we can no longer afford the high cost of electricity,” said FDC member Lynie Olimpo.
The upward adjustment in our electric rates is unjust. We do not know its basis. We hold not only Meralco, but the government as well, accountable to this mess. Because of the implementation of automatic generation rate adjustment, we are forced to pay such high increase without us knowing the basis for it.
Furious FDC members put charcoal on their face to signal the beginning of their fiery battle against high power rates.
“We demand that the automatic cost recoveries be stopped and the P1.25/kWh increase be investigated. We also demand that the onerous contracts by Napocor and Meralco with the independent power producers (IPPs) be cancelled. As long as these contracts exists and continues to be recognized, electricity in the Philippines will remain expensive and unaffordable,” said Fortaleza.