ERC Decides on SPEED

The Energy Regulatory Commission (ERC) issued an Order on October 11, 2002 authorizing the implementation of the Special Program to Enhance Electricity Demand (SPEED).

Under this program, qualified industrial and commercial customers of the National Power Corporation (NPC) are entitled to fixed SPEED discounts. In the Luzon Grid, NPC shall give a fixed discount of P0.80/kWh; in Cebu-Negros Grid, P0.70/kWh ; and in Mindanao Grid, P0.10/kWh.

The implementation of SPEED will address NPC’s concern on its present unutilized generating capacity. Effectively the reduction in power rates will encourage needed business activity and jobs to jumpstart the economy, which will ultimately benefit the end consumers.

The discount rates shall be applied to the incremental consumption which is the actual monthly energy consumption over the Customer Base Load (CBL) for the quarter, fixed for the duration of the program, and deducted from the effective selling rate of NPC.

The program shall be implemented into two (2) phases. During the first phase of the program implementation, discounts shall be given to industrial and commercial customers with a demand of at least 1,000 kw. These customers include (1) Directly connected customers with an existing power supply contract with NPC; (2) Customers of Distribution Utilities (DUs) with an existing power supply contract with NPC; (3) Customers in one contiguous area such as those operating within Export Processing Zone (EPZ), Special Economic Zone (SEZ) and industrial parks and estates served by a DU. Phase II will provide fixed discounts to the abovementioned customers with a demand of at least 500 kw.

The SPEED program takes effect immediately, until the implementation of the Wholesale Electricity Spot Market (WESM), or whenever there is no available NPC unutilized capacity, whichever comes first.

This program will provide discounts to qualified NPC customers projected to total P377.5 Million for calendar year 2003 and P364 Million for calendar year 2004 (until September 2004) with an estimated sales increase by as much as 1.2 Million kilowatthours for calendar year 2003 and 0.9 Million for calendar year 2004.

October 11, 2002