ERC assures public on power rates

THE ENERGY REGULATORY Commission yesterday assured the public that its recent order upholding the unbundled rates of power distributor Manila Electric Co. (Meralco) would not have an impact on existing electricity prices.

ERC executive director Francis Saturnino Juan made the assurance as consumer groups raised the alarm that the order might increase electricity prices, adding further burden to all consumers. He stressed that the implementation of the unbundled rates was not even put on hold even as the Commission on Audit was directed by the Supreme Court to conduct an audit of the books of Meralco.

Juan explained that the Supreme Court only said that Meralco’s rates would be provisional until the ERC has acted on the COA report. This meant that the Meralco rates were being implemented even with the audit.

The recent ERC order only made final the the unbundled rates of Meralco, he added.

The ERC earlier dismissed allegations of the COA, which claimed that Meralco had overcharged customers by as much as P7 billion in 2004 and 2007. With its order dated June 21, 2011, ERC maintained and affirmed its findings and conclusions in its decision dated March 20, 2003, and order dated May 20, 2003, directing Meralco to implement its unbundled rates.

The COA earlier disclosed that the unbundling of Meralco rates effectively resulted in over-recoveries, or specifically, revenues in excess of the required revenue by P1.68 billion in 2004 and by P5.33 billion in 2007.

In the COA report, it said that the excess in revenues was determined after it found certain factors/items, which should not have been included in the computation of Meralco’s revenue requirements.

However, the ERC countered these claims, noting that there might have been several factors that were not accounted for by the COA that led to the latter’s findings of excess revenue or over-recovery on the part of Meralco.

The decision was, however, criticized by the National Association of Electricity Consumers for Reforms Inc. (Nasecore), stressing that the ERC order was another “slur on the highest tribunal and an affront on the rights of the consumers to a just and reasonable rate.”