ERC denies Meralco motion to suspend reduction of transmission charge

The Energy Regulatoty Commission (ERC) denied Meralco’s motion to suspend the implementation of the reduction in the transmission charge resulting from the first stage phase-out of the Intra-Regional Grid Cross Subsidy (IRGCS).

ERC issued an Order dated September 24, 2003 granting the National Transmission Corporation (TRANSCO) authority to implement the first stage of the Intra-Regional Grid Cross Subsidy (IRGCS).

The phase-out will result in an estimated average rate reduction of PhP 0.063/kWh for Meralco residential customers and PhP 20.00/kW. for the industrial customers of the said distribution utility.

The effectivity date of the first phase of the IRGCS removal is on the September 26, 2003 – October 25, 2003 billing cycle of TRANSCO effective November 2003 for Meralco customers.

Section 74 of the Electric Power Industry Reform Act (EPIRA) as embodied in R.A. 9136 requires the removal of cross subsidies within a grid, between grids and/or classes of customers in a period not exceeding three years from the establishment of the ERC of a universal charge which shall be collected from all electricity end-users.

January 26, 2004