ERC hits Mactan Electric Co. with P55.6-million penalty

by Lenie Lectura – January 26, 2016

from Business Mirror

THE Energy Regulatory Commission (ERC) has slapped the Mactan Electric Co. (Meco) with a P55,658,600 fine for violating certain regulatory rules.

The agency said the Meco “willfully and deliberately violated existing laws, rules, regulations and orders/decisions of the commission.” In a statement, the ERC said the Meco was penalized for failure to submit its 2003 annual report and for failure to comply with the commission’s order dated April 24, 1997, under ERC Case 2001-357.

The ERC also ruled that the Meco failed to file Business Separation and Unbundling Plan, and had included the retail rates in power-supply contract costs without prior approval from the commission.

The ERC said it decided to impose substantial penalties because, based on records, the Meco “had the propensity to breach the commission’s rules and regulations as demonstrated by the number of violations it committed.”

“This fact cannot go unnoticed,” the ERC said. “This recent move to impose severe penalties on the Meco should convey to the industry the ERC’s strong resolve to ensure that laws, rules and regulations are complied with,” the agency said.

Earlier, the ERC also penalized the Manila Electric Co. for “negligence in the conduct of its business of distributing electricity” following complaints lodged by a customer for alleged overbilling.

“This resolve also applies to issuances, orders and decisions of the commission, particularly those that govern the quality of customer service,” the ERC said.

ERC Chairman Jose Vicente Salazar recently reiterated a warning to the electric-power industry that the commission “will hold accountable any power utility whose acts clearly result in clear disadvantage to customers.” Salazar had called on all distribution utilities “to ensure that their customers are fairly billed for electricity consumption based on accurate reading and computation of properly installed meters.”

“The ERC will hold accountable any power utility whose negligence results in clear disadvantage to customers. It is the right of every customer to have accurate meters that guarantee the correct registration of their electricity consumption,” the ERC official said.