Cebu power coop ordered to give back P78.5M to end-users

CEBU CITY -- The Cebu Electric Cooperative (Cebeco) I over-collected P78,469,056 from its consumers when it made power rate adjustments from 1996 to 2004 to recover new systems loss.

When the Energy Regulatory Commission (ERC) discovered that Cebeco recovered millions of pesos in excess, it directed the power distributor to reimburse its consumers.

Last month, the Court of Appeals (CA) affirmed ERC’s order for Cebeco to refund the money by reducing its power rates.

The CA said the findings of ERC that Cebeco over-recovered about P78.5 million was not tantamount to grave abuse of discretion.

Sun. Star Cebu on Friday called the office of Eden Silva, Cebeco I legal counsel, to get her statement but was told she was in Manila.

ERC-Central Visayas Director Joel Bontuyan, when sought for comment, said they have yet to get an official copy of the CA ruling.

Appeal

“I don’t know if it has become final and executory. If it hasn't, they may file an appeal to the SC (Supreme Court),” Bontuyan said in a text message.

Cebeco I serves the 18 southern Cebu towns of Sibonga, Argao, Dalaguete, Alcoy, Boljoon, Oslob, Santander, Samboan, Ginatilan, Malabuyoc, Alegria, Badian, Moalboal, Alcantara, Ronda, Dumanjug Barili and Carcar City.

According to its website, the power firm serves a total of 366 barangays with an area of 1,680.9 square kilometers.

Cebeco said the economic growth of the southern municipalities under its franchise area is slow because of the inherent geographic condition.

In 1996, Cebeco filed a petition before the Energy Regulatory Board, now ERC, seeking approval and provisional authority to implement the purchase power adjustment (PPA).

The ERC gave Cebeco provisional authority to use the PPA formula, but in 2006, it found out that utility cooperative over-collected from February 1996 to September 2004 because it used its own adjusted rate component.

Refund

ERC directed Cebeco to refund to its consumers P0.1358 per kilowatthour until the full amount is reimbursed.

Cebeco filed several pleadings to reverse the ERC’s orders but these were all denied with finality.

Cebeco brought the matter to the CA and claimed that ERC committed grave abuse of discretion.

It said it was deprived of due process after the ERC refused to take into consideration the effects of the power firm’s three mini-hydro plants into the components of power adjustment.

In the ruling, the appellate court held that the ERC did not commit abuse of discretion.

Technical

“Rate-fixing calls for a technical examination and a specialized review of specific details which the courts are ill-equipped to enter, hence, such matters are primarily entrusted to the administrative or regulating authority,” read the CA decision penned by Associate Justice Franchito Diamante.

Cebeco should have filed the rate adjustment with the ERC when it started using the mini-hydro plants, the appellate court said.

By doing that, Cebeco would be more efficient and cost-effective in the delivery of power to its consumers to legally implement the lower rates. (GMD/Sun.Star Cebu)