MANILA, Philippines - Brace for higher electricity bills in May, after the Energy Regulatory Commission (ERC) approved a government rate-hike petition.
In a decision, the ERC cleared an increase of P0.069 per kilowatt-hour in Luzon, P0.61 in the Visayas and P0.04 in Mindanao.
The rate hike is meant to help state-owned National Power Corp. (Napocor) settle fuel and foreign-currency exchange costs incurred from January 2007 to April 2010.
"These fuel, purchased power, and foreign currency costs are legitimate costs already incurred in their supply of power to their various customers. By law, they are entitled to recover these costs as part of the price of electricity they sell to their customers," Francis Saturnino Juan, ERC executive director, said.
The rate adjustment will take effect in May, and will continue to be passed on to consumers until Napocor's fuel and forex costs are recovered.
"The ERC has already mitigated the impact of these adjustments by spreading their recovery over a longer period and by coming out with this decision at the soonest to avoid additional carrying charges to be included in the recoverable amounts," Juan said.
Under ERC regulations, Napocor may recover previous costs it incurred in its operations through what is termed as deferred accounting adjustments (DAA).
These DAAs are the Generation Rate Adjustment Mechanism (GRAM) and Incremental Currency Exchange Rate Adjustment (Icera) for fuel and forex, respectively.
The GRAM and Icera are variable cost adjustments prescribed by the regulator that allow Napocor to recover from or refund its customers any increase or decrease in its fuel and purchased power cost as well as forex-related costs incurred in previous months.
source: interaksyon.com
