by Myrna Velasco – January 25, 2016
from Manila Bulletin
State-run National Power Corporation (NPC) is seeking regulatory approval for its true-up cost recoveries of P5.89 billion, translating to a rate hike of P0.0788 per kilowatt hour (kwh) on its monthly pass-on of universal charges.
The petition for cost recovery covering the shortfall of its universal charge collections for missionary electrification (UCME) and energy sales revenues will be filed with the Energy Regulatory Commission (ERC) on January 26 (Tuesday).
“The said petition is proposing to recover P5,895,588,224.47 shortfall for the year 2014. This translates to a true-up adjustment rate of P0.0788 kwh per month,” the state-owned firm said.
NPC president Gladys Cruz-Sta. Rita has indicated that the filing will not automatically increase the rates of the power firm at this time; but will only be so upon the approval of the industry regulator.
“The petition is a regular application based on the actual expenses as against the actual approved revenue and sales from missionary areas and the universal charge for missionary electrification,” she explained further.
The deficiency on its UC collections had been reckoned from year 2014. The company is bound to recoup such amount on a yearly basis based on the true-up adjustment scheme allowed under the Electric Power Industry Reform Act.
Sta Rita has reiterated that before this will turn into a rate hike, it “will still pass through the process of public hearing and the Commission’s evaluation and approval before implementation.”
The company expounded “the huge shortfall is due to the very low basic UCME of P0.0454 per kwh which translates to only P2.7 billion per year.”
The filing of cost recoveries is warranted because “this is one of the two sources of the corporation’s funds as enumerated under the EPIRA Law.” Its other source is energy sales collected from the electric cooperatives.
NPC’s core residual mandate under EPIRA is to pursue the energization of off-grid areas under its Small Power Utilities Group (SPUG), generally referred to as key component of the government’s missionary electrification program.