MERALCO GETS ERC NOD ON ITS 2010 RATES
The Manila Electric Company (MERALCO) has secured the Energy Regulatory Commission’s (ERC) approval for its distribution, supply, and metering charges for Regulatory Year (RY) 2010 for its various customers based on the application it filed on 07 August 2009 to raise its average rates to PhP1.4917/kWh from the existing PhP1.2227/kWh, or an average increase of PhP0.2690/kWh.
MERALCO filed its application for its 2010 maximum average rate based on the ERC’s Rules for the Setting of Distribution Wheeling Rates (RDWR) of the Privately-Owned Distribution Utilities (DUs), as amended. Under the RDWR, the ERC reviews and approves the maximum average distribution wheeling rate that privately-owned DUs may impose during a Regulatory Year (RY), as well as the translation of this maximum average distribution wheeling rate into a distribution rate structure for the rates to be imposed on the DUs’ different customer classes.
In its application, MERALCO computed its 2010 maximum average price at PhP1.9410/kWh in accordance with the formula provided in the RDWR, which takes into account economic factors such as inflation and foreign exchange rate, as well as the DU’s actual performance in terms of the approved Performance Incentive Scheme (PIS) and the previous years’ under/over recoveries in its distribution revenues. With this resulting increase, following the RDWR provision on side constraints, which mitigates the adjustment that can be allowed for a DU so as to prevent huge price increases for its consumers, MERALCO’s 2010 rate was subjected to a ceiling computed at PhP1.4917/kWh.
The ERC set the application for initial public hearing on 6 October 2009 in an Order that was duly published in major newspapers. Subsequent hearings were conducted on 13, 19 and 26 November 2009, which were attended by various stakeholders and consumer groups.
In its review of MERALCO’s filing and submissions, the ERC verified the figures used by MERALCO as inputs to the formula for computing its 2010 maximum average price to come up with an efficiency factor of minus 4.75%, and adopted the changes to the parameters used in the calculation based on the amendments to the RDWR to ensure consistency among all privately-owned DUs entering the Performance-based Regulation. With these modifications, the ERC calculated MERALCO’s 2010 maximum average price at PhP1.9406, which when capped based on the side constraint provision of the RDWR, can only be set up to PhP1.4917/kWh. Translating this into rates for MERALCO’s different customers, the ERC approved the following rate schedule:
Units |
Existing Rates |
Approved RY 2010 Rates (with side constraints) |
Incr./(Dec.) |
|
DISTRIBUTION
|
||||
Residential & General Service A |
P/kWh |
0.6917 |
0.8822 |
0.1905 |
Up to 200 kWh |
P/kWh |
0.9953 |
1.1858 |
0.1905 |
201-300 kWh |
P/kWh |
1.2816 |
1.4721 |
0.1905 |
301-400 kWh |
P/kWh |
1.7803 |
1.9708 |
0.1905 |
401 kWh & Over |
P/kWh |
|||
General Service B (Small NIS/IS) |
||||
P/kW |
200.60 |
265.05 |
64.45 |
|
P/kWh |
0.0210 |
0.0210 |
0 |
|
General Power |
||||
Secondary |
P/kW |
200.60 |
265.05 |
64.45 |
Below 13.2 kV |
P/kW |
152.60 |
217.05 |
64.45 |
13.8/13.2 kV |
P/kW |
152.60 |
217.05 |
64.45 |
34.5 kV |
P/kW |
152.60 |
217.05 |
64.45 |
115 kV & 69kV |
P/kW |
122.76 |
187.20 |
64.44 |
Unit charge : General Power users |
||||
Normal consumption |
P/kWh |
0.0210 |
0.0210 |
|
34.5 kV (with ODPS load) |
P/kWh |
0.3860 |
0.0210 |
0 |
115 kV (with ODPS load) |
P/kWh |
0.3260 |
0.0210 |
(0.3650) |
GHMS |
P/kWh |
0.6860 |
0.8800 |
(0.3650) |
Flat streetlights |
P/kWh |
1.5360 |
0 |
0.1940 |
125W MV or 70W HPS |
Lamp |
77.85 |
||
250W MV or 150W HPS |
Lamp |
155.70 |
||
400W MV or 250W HPS |
Lamp |
249.12 |
||
400W HPS |
Lamp |
397.90 |
||
SUPPLY
|
||||
Residential & General Service A |
||||
P/Cust./mo |
15.70 |
19.50 |
3.80 |
|
P/kWh |
0.4720 |
0.5830 |
0.1110 |
|
General Service B (Small NIS/IS) |
P/Cust./mo |
700.00 |
865.00 |
165.00 |
General Power |
||||
Medium (Demand 40-200 kW) |
P/Cust./mo |
1,600.00 |
1,980.00 |
380.00 |
Large (demand 200-750 kW) |
P/Cust./mo |
8,140.00 |
10,060.00 |
1,920.00 |
Very & extra large (demand >= 750 kW) |
P/Cust./mo |
13,500.00 |
16,700.00 |
3,200.00 |
GHMS |
P/Cust./mo |
276.80 |
342.00 |
65.20 |
Flat streetlights |
P/kWh |
0.5745 |
||
125W MV or 70W HPS |
Lamp |
31.95 |
||
250W MV or 150W HPS |
Lamp |
63.90 |
||
400W MV or 250W HPS |
Lamp |
102.24 |
||
400W HPS |
Lamp |
163.30 |
||
Metering |
||||
Residential & General Service A |
||||
P/Cust./mo |
5.3000 |
6.50 |
1.2000 |
|
P/kWh |
0.3380 |
0.4180 |
0.0800 |
|
General Service B (Small NIS/IS) |
P/Cust./mo |
360.00 |
445.00 |
85.00 |
General Power |
||||
Medium (Demand 40-200 kW) |
P/Cust./mo |
844.20 |
1,050.00 |
205.80 |
Large (demand 200-750 kW) |
P/Cust./mo |
3,500.00 |
4,340.00 |
840.00 |
Very & extra large (demand >= 750 kW) |
P/Cust./mo |
12,000.00 |
14,850.00 |
2,850.00 |
GHMS |
P/Cust./mo |
261.20 |
322.75 |
61.55 |
AVERAGE RATE |
P/kWh |
1.2227 |
1.4917 |
0.2690 |
The calculation of MERALCO’s 2010 rates strictly follows the methodology contained in the RDWR, which provides for an annual review and verification of the private DUs’ rates This process is incorporated in the RDWR to promote a transparent and stable regulatory environment, ensure the recovery of only those costs which are related to the provision of the DUs’ regulated distribution services while maintaining the viability of the DUs, and enable them to provide sustainable and quality electricity distribution service delivery for all their customers into the future.
With the approved increase for them at 40.65centavos/kWh, MERALCO’s residential customers with a monthly consumption of 200 kWh will experience an increase in their bill by about PhP81, assuming all other charges to remain unchanged. The lifeline consumers will continue to enjoy the lifeline discounts based on the lifeline program approved for MERALCO, including the 100% discount for those consuming up to 20 kWh/month who are only liable to pay the fixed metering charge of PhP6.50. The new rates take effect starting on January 2010.
“Given that MERALCO in the past years experienced a reduction in its generation charge at the start of the year, the ERC is optimistic that, notwithstanding the increase in MERALCO’s rates, the reduction in the other charges in the customers’ total bill will be more than sufficient to mitigate or even offset the impact of this adjustment,” ERC Executive Director Francis Saturnino Juan said.
December 29, 2009