ERC to lower system loss cap

By Jordeene Sheex Lagare – February 13, 2018
from The Manila Times

The Energy Regulatory Commission (ERC) is set to issue rules lowering the system loss cap, a move expected to considerably ease the burden on electricity consumers.

At a press briefing on Monday, ERC Chairman Agnes Devanadera called the move a “major” decision, adding that it was among “about 61 applications” acted on over the past few months.

The cap seeks to address the amount that can be passed on by distribution utilities (DUs) to consumers in their monthly electricity bills.

A system loss charge is the power used or lost in the distribution system for delivering power from a DU’s receiving point to its consumer’s metering point.

A system loss can be both technical and non-technical.

The charge for private DUs will drop from the current 8.5 percent to between 5.5 percent and 6.5 percent, and from 13 percent to between 8.25 percent and 12 percent for electric cooperatives over a four-year transition period.

This move came as ERC said it would not immediately act on the pending power supply agreements (PSAs) that the Manila Electric Co. (Meralco) struck with its sister companies.

 This, despite the Court of Appeals’ (CA) move to lift on Friday the one-year suspension without pay imposed by the Office of the Ombudsman on ERC Commissioners Alfredo Non, Gloria Victoria Yap-Taruc, Josefina Patricia Magpale-Asirit and Geronimo Sta. Ana.

CA made the decision so as not to impair public service.

The four, together with former ERC Chairman Jose Vicente Salazar, had been accused of unduly favoring Meralco’s PSAs with its affiliated firms by extending the deadline for their compliance with the competitive selection process (CSP) in 2016.

The suspension caused Devanadera to say last December that her agency is paralyzed.

The pending Meralco PSAs before them, just like any other application, need to undergo the usual process being done by the regulator’s technical working group (TWG), Devanadera said on Monday.

“It’s subject to the same rules in evaluating the PSAs,” she added, saying these power deals are still with the TWG.

Asked about whether the PSAs should be resolved before he retires, Non said “it doesn’t have to do with my stay or retirement” from ERC.

“As the [chairman]said, all of it will have to go through the certain process. If it’s completed before my retirement, it’s fine. If it doesn’t, then ERC continues,” he added.

The PSAs will not “probably” be decided on before he retires by July, the ERC commissioner said, adding that some of the deals are still being heard by them.