MANILA, Philippines — The Energy Regulatory Commission (ERC) has cleared Manila Electric Co. (Meralco) to refund its customers nearly P13.9 billion over a two-year period.
In an order, the ERC directed Meralco to refund a total of P13.89 billion or equivalent to an average refund of P0.1528 per kilowatt-hour to its customers within approximately 24 months or until the amount is fully refunded.
“The commission approved Meralco’s prayer for the issuance of a provisional authority in order to allow their customers to immediately enjoy the benefits of the proposed refund and provide immediate rate relief especially during this time of pandemic,” ERC chair and CEO Agnes Devanadera said before the weekend.
Earlier, Meralco, in its application, sought the ERC’s confirmation of its actual Weighted Average Tariff (AWAT) as against the ERC-approved Interim Average Rate (IAR) to determine if there is any over or under recovery.
“As regulator of the electric power industry, the Commission, in determining its actions on applications filed before it, has the consumer welfare as its primary consideration, thus our decision to immediately authorize the refund. We hope that the reduction in rate could help our consumers cope with the still ongoing pandemic,” Devanadera said.
Meralco said it will comply with the ERC directive, but hopes that the power regulator will finally approve the next Performance-based Regulation (PBR) reset.
“With the petition we filed, Meralco hopes to put the PBR mechanism back on track, that we appreciate the provisional approval and that we will follow the order as this will provide much needed relief to our customers,” Meralco vice president for corporate communications Joe Zaldarriaga said.
The ERC has yet to approve the rules for the PBR of privately owned distribution utilities from July 2015 onwards, which is why Meralco used the IAR in the third regulatory period from July 1, 2011 to June 30, 2015.
The ERC said the provisional authority only covers the refund of the amount as applied by Meralco.
Except for authorizing the refund as applied, all other allegations, assumptions and computations made in the instant application are still subject to the ERC’s extensive evaluation and pertinent rules on the matter.
The ERC also directed Meralco to reflect the refund as a separate line item in the bills of its customers during the refund period.
The residential and general service A category will have a refund of P0.2761 per kwh; general service B with P0.1811 per kwh; general power with P0.0789 per kwh; GHMSCI with P0.1165 per kwh; flat streetlights P0.2870 per kwh and generator wheeling with P0.0366 per kwh.
Meanwhile, ERC clarified that the refund is without prejudice to the outcome of the final evaluation of the application after completion of both technical and legal proceedings.