‘Overcharged’ Meralco wants higher refund

Manila Electric Co., the country’s biggest power distributor, is now seeking a higher refund of about P10 billion that was allegedly “overcharged” by the state-run Power Sector Assets and Liabilities Management Corp. (PSALM).

The P10 billion represented the additional transmission line costs that were “double charged” to Meralco customers.

Francis Saturnino Juan, executive director of the Energy Regulatory Commission, explained that Meralco had recently updated its calculation, increasing it from the initial estimated cost of P9.1 billion.

PSALM, Juan added, was given the opportunity to further ventilate its position but did not offer the ERC any alternative computation or resolution on the matter.

“Nothing in the past has prevented PSALM from filing its calculation, but as far as I know, no exact figure was given by PSALM, so we’ll leave it to the ERC to decide on the matter on how to settle the issue,” he said.

“Hopefully, the case will be included already in the agenda for deliberation in one of the commission meetings set in November and a decision will already be reached by then. I cannot give you a definite timeline right now—it depends really on what the commission will do [with] the recommendation of the staff,” Juan further explained.

Meralco earlier complained of being double charged because of the 2.98-percent transmission loss recovery (or line losses) included the transition supply contract (TSC) between National Power Corp. and the distribution utility, and the line rental charges, which included congestion cost and line losses, being collected by the Philippine Electricity Market Corp. since the wholesale electricity spot market (WESM) started operating in June 2006.

The ERC, in a decision dated March 10, 2010, already found a “double charging in transmission line costs.” But compliance by various parties involved was incomplete as some of the data needed for the computation were no longer available.

For instance, PEMC earlier commented that “the segregation of line rentals into transmission loss and congestion cost since the start of the commercial operations of the WESM would entail reconstruction of hourly data for the last five years and would cause considerable strain in its resources.”

Meralco thus suggested an outright refund of the 2.98 percent transmission loss recovery factor included in the TSC. This proposal, however, was countered by PSALM which insisted that the computation for the refund should be based on actual segregated line rentals.

Meralco already submitted a summary of TSC line loss computations and the breakdown of TSCs from July 2006 to May 2012, and supporting invoices and official receipts covering the period July 2006 to May 2012.