ERC allows PSALM to recover P5 B universal charge

MANILA, Philippines — The Energy Regulatory Commission has allowed the Power Sector Assets and Liabilities Management Corp. to collect the under recovery of universal charge for stranded contract cost (UC-SCC) amounting to P5.12 billion.

In the same order, the ERC allowed PSALM to implement the UC-SCC rate of P0.0543 per kilowatt-hour (kwh).

The power regulator also directed all distribution utilities (DUs) and the National Grid Corp. of the Philippines (NGCP) to collect from Luzon, Visayas, and Mindanao customers the said UC-SCC charge under a 12-month recovery period.

“Extending further the period of recovery is seen to further burden the consumers as such extended period will only further increase the cost of repayment,” the ERC said.

“The commission deems that the 12-month period is the longest it could approve to mitigate the UC-SCC rate impact,” it said.

The approved amount is lower than the P7.35 billion SCC and P0.0907 per kwh UC-SCC rate applied for, which PSALM said would allow it to service maturing loan obligations.

SCC refers to the excess of National Power Corp.’s (Napocor) contracted cost of electricity with independent power producers over the actual selling price of the output.

Under PSALM’s proposal to recover UC-SCC, the ERC said the eligible IPP contracts comprise Benguet Mini-hydros, Unified Leyte, Pagbilao I and II, and Sual I and II.

PSALM, the entity created under Republic Act 9136 or the Electric Power Industry Reform Act of 2001, is allowed to recover through UC the payment of Napocor’s stranded debt and SCC.