MANILA Electric Co. (Meralco) has proposed to collect in the next 12 months a net underrecovery of P7.98 billion, which it accumulated in the past three years, an official of the company said.
“We have an estimated impact to customers of around 22 centavos per kilowatt-hour (kWh) but still dependent on ERC (Energy Regulatory Commission) approval with respect to the term if approved for a longer or shorter period,” Jose Ronald V. Valles, Meralco’s first vice-president and head of its regulatory management, said in a virtual briefing.
Underrecovery of the power generation charge, a cost passed on to consumers, occurs as a result of the lag in the collection of these costs from electricity users.
Mr. Valles said for the years 2020, 2021 and 2022, Meralco’s net underrecovery for the generation, transmission, system loss, and subsidies amounted to P7.78 billion. Including real property tax and local franchise tax underrecoveries for 2021 and 2022, Meralco’s net underrecovery amounted to P7.98 billion.
“Meralco will be proposing a recovery period of 12 months for all the charges, except for lifeline subsidy over-recovery, which will be refunded in one month,” he added.
Under ERC rules, distribution utilities in Luzon are scheduled to file their pass-through over/underrecoveries (OUR) by March 31, however, Meralco requested for an extension to file until April 30, citing “voluminous documents that need to be prepared and validated.”
ERC Chairperson and Chief Executive Officer Monalisa C. Dimalanta has given her assurance that the agency will review Meralco’s underrecoveries and will only allow reasonable costs for recovery.
“The P7.98-[billion] appears to be Meralco’s initial calculation for the collection of its underrecoveries for the period 2020 to 2022. The over-under (OU) [recovery] application however is not yet filed with ERC, after filing we will still evaluate and only allow validated reasonable costs for recovery,” Ms. Dimalanta said in a Viber message.
Meanwhile, the power utility giant said that its distribution rate true-up (DRTU) refund will be completed next month. The amount represents the difference between the actual weighted average tariff and the ERC-approved interim average rate for distribution-related charges.
Mr. Valles said that as of March, Meralco has refunded 93% or P44.7 billion of the P48.3 billion DRTU refund.
Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls. — Ashley Erika O. Jose