Amid another round of electricity rate increases, Senator Risa Hontiveros is seeking a review of the Energy Regulatory Commission’s (ERC) automatic pass-through mechanism as recent power rate increases no longer pass scrutiny by the regulator.
‘Review first, collect later. Kailangang patunayan at ipaliwanag muna ang bawat sentimong sisingilin bago ito ipasa sa konsyumer. Dapat ganyan ang polisiya natin. Bakit nga ba hindi puwedeng suriin ng ERC ang mga pass through charges bago ipasa sa konsyumer? Baligtad kasi ang sistema natin: pinagbabayad muna ang taumbayan bago lubusang masuri kung tama at makatwiran ang singil,’ Hontiveros said.
Under the Electric Power Industry Reform Act (EPIRA), generation, transmission, distribution, and other eligible expenses are recoverable costs regulated by the ERC. However, under existing ERC rules, adjustments in pass-through charges, such as generation costs driven by fluctuations in fuel prices, are automatically collected from consumers by distribution utilities and remitted to power suppliers.
Hontiveros noted that generation, transmission, and system-loss charges account for roughly 77% of the residential rate.
Although Section 23 of EPIRA requires distribution utilities to supply electricity to their captive customers at the least possible cost, Hontiveros warned that automatic pass-through could weaken their incentive to secure cheaper power because higher costs may ultimately be recovered from consumers.
‘Ito ang resulta ng automatic pass-through: walang insentibo ang mga kumpanyang humanap ng pinakamurang pagkukunan ng kuryente. When power companies know that consumers will ultimately shoulder every increase, they have less incentive to negotiate harder and secure electricity at the lowest possible cost,’ she said.
Her call comes after the National Grid Corporation of the Philippines (NGCP) announced a P0.77-per-kWh transmission rate increase, following an earlier P0.34-per-kWh increase in Meralco’s generation charge. Together, the two adjustments would add approximately P222 to the monthly bill of a household consuming 200 kWh.
The additional expense would wipe out nearly four days’ worth of the P60 daily wage increase that National Capital Region (NRC) minimum-wage earners are set to receive beginning July 25.
‘Bago pa maramdaman ng manggagawa ang dagdag-sahod, kinakain na agad ito ng dagdag-singil sa kuryente. Ang P222 ay katumbas na rin ng apat hanggang limang kilong bigas. Imbes na mapunta sa pagkain, pamasahe, o gamot ang dagdag-kita, mauubos lamang ito sa mas mataas na electric bill,’ she said.
Hontiveros earlier filed Proposed Senate Resolution No. 509, seeking an inquiry into the ERC’s policies on disputed electricity bills and rate increases, with the aim of amending EPIRA and related regulations to strengthen consumer protection.
‘Ang hinihingi natin ay simpleng proteksyon: suriin muna bago singilin. Hindi dapat mauna ang dagdag-singil at mapilitang magbayad ang konsyumer at maghintay na lamang kung magkakaroon man ng adjustment o refund,’ Hontiveros concluded.