Monday, September 08, 2008 Lawmaker says Meralco should abide by Epira
DISTRIBUTION giant Manila Electric Company (Meralco) may lose its franchise if it will continue to violate the provisions of the Electric Power Industry Reform Act (Epira) by charging its customer higher electricity rates.
"Meralco must show a social conscience by not increasing its rates unnecessarily and by showing, with full transparency, that its increases are justified," Senator Loren Legarda said.
Citing the reports of the consumer group National Association of Electricity Consumers for Reforms (Nasecore), Legarda said Meralco bought more than 50 percent of its power needs from Lopez IPPs (independent power producers) at an average cost of P5.38 per kilowatt hour (kWh), higher than the price of state-run National Power Corporation (Napocor) for the same kWh for the month of August which was only placed at P3.57, while the wholesale electricity spot market (WESM) pricing was only P3.09 per kWh.
"This is something that DUs (distribution utilities) cannot brush aside: the mandate to provide the cheapest available electricity to their customers," said Legarda.
Last week, the Energy Regulatory Commission (ERC), a day after it allowed the distribution giant to collect its under-recoveries of about P1.9 billion which translates to an increase in the bill of its consumer by 0.24 centavos, has ordered Meralco to submit its books to the Commission on Audit (COA) to determine if there are irregularities in their rate increases.
According to Legarda, Meralco must take the COA audit as an opportunity to prove that its operation and its charges to consumers are in order. "But a refusal to be audited will not be seen kindly by our people, more so by Meralco consumers, especially in the face of complaints of overcharging against the company."
To recall, the Supreme Court (SC) ordered an audit of Meralco's financial statements, records and transactions in 2006 to justify its provisional power increase in 2003.
The SC tasked the ERC and COA to coordinate in conducting the audit of Meralco. (MSN/Sunnex)
