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PIA Press Release

ERC okays BILECO application for provisional power rate adjustment

By Rodrigo S. Victoria

Naval, Biliran (4 February) -- The Energy Regulatory Commission (ERC) through its five commissioners issued an order to Biliran Electric Cooperative, Inc. (BILECO) provisionally authorizing to implement its proposed provisional power rate adjustment.

The ERC order dated January 11, 2010 also directed BILECO to adopt the provisionally approved proposed Revised Rate Schedule effective the January 2010 billing period.

However, Samuel Trinidad, Manager of the Membership and Services Division (MSD) of BILECO clarifies in a telephone interview that the proposed provisional power rate adjustment was not yet reflected in the January billing period because the electric cooperative has already made the January billing before the ERC order was issued.

The proposed Revised Rate Schedule is implemented in three years time effective this year as the start of transition until 2012 based on the ERC order.

In the ERC order, the proposed transition rates based on the following reflected components are as follows: (residential-current) distribution (kwh)-P1.2475, supply (kwh) ? P0.5763, metering (customer) ? P5.0000, metering (kwh) P0.9262

At the start of the ransition period in 2010, the proposed transition rates based on the following reflected components are as follows: (residential) distribution (kwh)-P1.1842, supply (kwh) ? P0.7254, metering (customer) ? P5.0000, metering (kwh) P0.8117

In 2011, the proposed transition rates based on the following reflected components are as follows: (residential) distribution (kwh)-P1.1209, supply (kwh) ? P0.8745, metering (customer) ? P5.0000, metering (kwh) P0.6972.

In 2012 which is the end of the transition period, the proposed transition rates based on the following reflected components are as follows: (residential) distribution (kwh)-P1.0557, supply (kwh) ? P1.0282, metering (customer) ? P5.0000, metering (kwh) P0.5792.

In the current power bill of BILECO, the item Final Loan Condonation with a rate of P0.4890 is removed and is replaced with the Members Contribution for Capital Expenditures (MCC) having a constant rate of P0.5324 over a period of three years.

Moreover, the ERC urged all other persons who may want their views known to the Commission with respect to the subject matter of the proceeding may file their opposition to the application or comment at any stage of the proceeding before the applicant concludes the presentation of its evidence.

The Commission also requires no particular form of opposition or comment but the document, letter or writing should contain the name and address of such person and a concise statement of the opposition or comment and the grounds relied upon.

The Commission has set the original and emended applications for jurisdictional hearing on February 8, 2010 (Monday) at 1:30 in the afternoon at the ERC Hearing Room, 15th Floor, Pacific Center Bulding, San Miguel Avenue, Pasig City.

For his point, Samuel Trinidad, the Manager of the Membership Services Division (MSD) of BILECO in a telephone interview said that the provisional proposed power rate adjustment is in accordance with provisions of Republic Act 9136 otherwise known as the Electric Power Industry Reform Act of 2001 where it authorizes ERC to establish a methodology for setting distribution wheeling rates.

He added that the proposed power rate adjustment is embodied in the Rules for Setting the Electric Cooperatives Wheeling Rates (RSEC-WR) where it seeks to develop a regulatory regime that encourages efficiency in the operations of the electric cooperatives.

Meanwhile, BILECO contended in its prayer submitted to ERC that it is applying to implement the proposed rates as it strongly believes that it will encourage the cooperative to develop efficiency and achieve self-reliance and financial independence, and be able to comply with the mandate of the Electric Power Industry Reform Act to deliver more reliable, efficient, safe and quality service to its consumers.

Furthermore, BILECO chooses to implement the proposed rates during the transition period in three installments for Distribution, Supply and Metering (DSM) up to the tariff cap in order to mitigate the impact of the adjustment both of the cooperative and its customers especially on the distribution, supply and metering charges which showed positive and a negative effect from the existing rates and one time CAPEX (Capital Expenditure) rate at the start of the transition period to enable the cooperative to raise funds needed for its projects. (PIA-Biliran) [top]

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