Sen. Erwin Tulfo on Thursday questioned energy-related agencies why line rental fees are being shouldered by consumers on top of system loss charges.
Tulfo brought up the subject during a Senate energy panel hearing tackling proposed amendments to the Electric Power Industry Reform Act (Epira).
In a query directed to the National Grid Corporation of the Philippines ( NGCP), the senator asked why consumers – primarily in Visayas and Cebu – are paying line rental fees.
‘Because, NGCP, your infrastructure is lacking…is that a consumer problem? Even the power line will be paid for,’ said Tulfo.
‘I’m very disappointed that you abused the consumers. Because Juan and Maria are silent. Can you explain that to us, NGCP? Even line rental is charged to the consumer. Please, please explain,’ he added.
In response, NGCP assistant vice president Cynthia Albanza explained that line rental was a ‘misnomer,’ clarifying that the fee is not actually paid to the NGCP, but is simply ‘a cost.’
‘It’s a premium on electricity that is a cost when a line is technically overbooked because there is a power plant that goes offline. So that sources from outside,’ she explained.
Asked why it almost always happens every month, Albanza further explained that it is also caused by unplanned shutdowns of plants, which then result in the NGCP having to source from another place.
‘It’s a little bit more pronounced in the Visayas because they are all islands. So the main cause of line rental would be the interconnections. So if you have a plant that goes offline and you have to get it from another place, they will have a premium on that other source,’ said Albanza.
‘But the fee doesn’t go to the NGCP,’ he added.
Tulfo then questioned the Energy Regulatory Commission (ERC), as well as other departments why they continue to allow the NGCP to have consumers pay for the cost of the needed lines.
ERC chief Saturnino Juan then said the agency is currently working on adjusting the ‘net settlement surplus’ which would allow those paying the higher fee to get bigger refunds.
‘Our evaluation of this is already in its final stages because we also have a petition pending with us … And this is something we will really take action to fix, especially in the Visayas,’ he said