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Monday, September 06, 2004
20%-50% cut for small power consumers
MANILA -- Consumers who use minimal electricity per month will enjoy up to 50 percent discount, in an arrangement intended to cushion the impact of the newly approved 40 percent increase in charges of the National Power Corp. (Napocor).
Presidential spokesman Ignacio Bunye said the discounts or lifeline rates were imposed by President Arroyo even before Napocor filed its petition for a rate increase.
Arroyo issued the directive to Energy Secretary Vicente Perez last July.
Under the lifeline rates, consumers with a monthly consumption of 50 kilowatt-hours (kwh) or less will enjoy a 50 percent discount in their monthly payments. Those who consume 51 to 71 kwh per month will get a 35 percent discount and those with a monthly consumption of 71 to 100 kwh, 20 percent.
"Small-time consumers" make up a third of the clients served by the Manila Electric Company (Meralco) and about a quarter of consumers outside the Meralco-covered areas.
Bunye said President Arroyo's directive was to implement the discounts if Napocor's petition got approved. He also assured that the increase is still provisional.
The Energy Regulatory Commission (ERC) earlier approved a 40 percent provisional increase in Napocor charges, starting at the end of September.
This translates to an increase of P1.23 per kwh in Luzon, 22.02 centavos for Visayas and 26.65 centavos for Mindanao, or an average of 97.98 centavos.
The present average rate of Napocor for the entire country is P2.44 per kwh, but the rates vary for every island group: P2.57 for Luzon, P2.82 for the Visayas and P1.80 for Mindanao.
Too small?
The ERC said the increase is expected to generate P110 billion in revenues for the next 12 months, which Napocor president Rogelio Murga negated, claiming that only P35 billion will be generated in a year, "hardly making a dent" on Napocor's P500-billion debt.
Napocor also said it will continue to lobby with ERC to grant a larger increase.
Bunye said the government is fully aware of the growing debt of Napocor, which is why the administration is pushing for its privatization, starting with the transmission lines.
There are no immediate plans or even talks of amending or scrapping the Emergency Power Industry Reform Act (Epira), which provides for the modernization of the electric industry and the privatization of Napocor, Bunye added.
Arroyo last week ordered the Department of Justice (DOJ) to determine if there is still a need to pass the bill to enable the privatization of the National Transmission Corp. (Transco).
The President sought the DOJ's opinion after Senators Juan Ponce Enrile and Miriam Defensor-Santiago claimed that the Transco bill is no longer needed, as the Epira has already provided for the privatization process.
6 months
Section 8 of the Epira (RA 9136) states: "Within six months from the effectivity of the Epira, the transmission and sub-transmission facilities of the Napocor and all other assets related to transmission operations, including the nationwide franchise of Napocor for the operation of the transmission system and the grid, shall be transferred to Transco."
The administration has been trying to pass the Transco bill since 2001. The bill nearly made it last year after the House of Representatives passed its version, but the Senate counterpart has not been passed.
At least five power companies have already expressed interest to join the bidding for the right to operate Transco for at least 25 years.
"To make Transco more efficient, the corporation must be privatized in order that private contractors will maintain and finance the cost of distributing power to electric cooperatives at no cost to the government," said President Arroyo.
She added that an estimated US$2.5 billion is needed over the next 10 years to strengthen Transco's transmission grid and provide electricity to every barangay in the country. (Sunnex)
(September 6, 2004 issue)
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