ILOILO City – Mayor Jerry Treñas and business groups here called for swift action from the Energy Regulatory Commission (ERC) relative to the increased power rate brought by the damaged submarine cable of the National Grid and Power Corp. (NGCP).
In the billing for August 2021, rates in this city increased by P1 per kilowatt hour (kWh) for residential consumers.
This could further increase to around P10 per kWh for the September 2021 billing, said Treñas.
ERC must resolve the problem “maybe in the form of regulatory intervention in the pricing mechanisms of the energy market or mandating NGCP to resolve the problem with the submarine cable at the soonest,” Treñas wrote ERC Chairperson Agnes Devanadera.
This southern city was enjoying the distinction of being the city with the lowest electricity rate in the country, according to Treñas.
More Electric and Power Corp. (MORE Power) was able to bring down the cost of power to only P6.45 per kilowatt hour (kWh) for residential customers, and even lower for commercial and industrial rate classes, he said.
“Fairness requires that the negligence of the DPWH or NGCP should not penalize the consumers of Iloilo City by the increase in rates. Competitive electricity prices will go a long way in helping our constituents amidst this pandemic,” Treñas stressed.
Treñas added that ERC’s swift action on the matter is the “only way to restore normalcy and stability” to the power supply of the city and Western Visayas as a whole both in terms of pricing and reliability.
To recall, dredging and re-channeling activities of Department of Public Works and Highways (DPWH) along Bio-os River in Barangay Jagna, Amlan, Negros Oriental on June 15 damaged NGCP’s 138 kiloVolt (kV) high voltage submarine cable there.
The operations affected one of the two cables connecting Cebu and Negros thereby reducing the capacity of the interconnection by 50 percent.
In effect, this causes congestion in power flow in certain hours of the day especially during the certain peak and drives electricity prices higher during those time intervals.
For its part, the Filipino-Chinese Chamber of Commerce of Iloilo Inc. through its president Vicente Tang also appealed for ERC’s help in whatever form so that the electricity rates in the city would revert to P6.45 per kWh.
The Iloilo Economic Development Foundation, Inc. (ILEDF) echoed the same appeal.
“As a group, ILEDF is raising attention to this important issue of power rates in order ensure that Iloilo City consumers are not penalized for the damages created by DPWH and/or NGCP. The mandate of ILEDF has always been to advocate and promote business competitiveness especially amid a globally challenging and disruptive economic environment. We are expecting prompt action on this appeal,” said ILED chairperson Engr. Terence Uygongco.
Meanwhile, Iloilo Business Club, Inc. also requested the NGCP to “urgently look into this matter and provide immediate regulatory intervention to ensure llonggo consumers do not suffer from the consequences of this incident especially at this time of the pandemic”.
“The swift resolution of this problem will go a long way in our business operations as we try to save on costs and work towards economic recovery,” the group said.
HIGH WESM LINE RENTAL CHARGES
MORE Power, meanwhile, also sent letters to Devanadera twice regarding the very high Wholesale Electricity Spot Market (WESM) line rental charges.
In his first letter, Castro sought guidance and assistance of the ERC on the recently issued July 2021 WESM Bill of Independent Electricity Market Operator of the Philippines (IEMOP) to MORE Power. The July 2021 WESM Bill covers the billing period from June 26, 2021 to July 25, 2021.
Castro said numerous extreme price separations were observed which is attributable to the incident happened to one of the 2x90MW circuits of NGCP’s submarine cable between Cebu and Negros that limits the flow of power supply between islands.
Castro noted that the limitation in supply was further aggravated by the preventive maintenance of Palm Concepcion Power Corp. in Panay.
This extraordinary market condition might extend until next year pending the repair of the damaged submarine cable of the NGCP, Castro pointed out.
“In July 2021, MORE Power was able to achieve the lowest residential electricity rates because of the ERC-approved competitive TOU (Time-Of-Use) Rates for PSALM (Power Sector Assets and Liabilities Management Corp.). Unfortunately, this effort of MORE is now being challenged by the line rental and congestion charges that were brought about by an incident over which MORE Power had no fault or participation,” Castro said in another letter.
He disclosed that this month, the generation charge of MORE is projected to increase by 76 percent after hitting a record low of P3.55 per kWh in July 2021.
“MORE Power is bleeding to pay IEMOP (Independent Electricity Market Operator of the Philippines) a line rental amount of P164.4 million, more than twice that of P66.15 million from last month,” Castro lamented.
He noted that this extreme price hike in WESM projected to continue until December, pending complete repair of the NGCP’s damaged submarine cable.
This, he added, means another unbearable four months for the paying consumers just because of the “underwater mishap” of the DPWH’s operator.
“MORE Power would like to respectfully request the immediate attention of the Honorable Commission to urgently look into the burden caused by the damaged submarine cable as this will continuously rip the consumers by paying exorbitant electricity rates,” said Castro.
Earlier, Iloilo City Rep. Julienne Baronda and Iloilo’s 2nd District Rep. Michael Gorriceta brought up the issue on power rate during the House Committee on Appropriations’ Budget Briefings/Hearings of the Department of Energy.
Energy Undersecretary Emmanuel Juaneza assured that “once we receive the report from NGCP, immediately the DOE will call for a Zoom meeting to start the investigation together with ERC as to the liquidation of damages or whatever should be charged to the injury caused by the damage to the consumers.”/PN