The Energy Regulatory Commission announced on Friday, May 31, that it has issued an interim approval for the implementation of the Power Supply Agreement (PSA) between Central Negros Electric Cooperative (CENECO) and the Energy Development Corporation (EDC), in a bid to arrest the increasing electricity rates affecting central Negros.
The ERC gave interim relief for EDC to supply power to CENECO at the rate of PP5.5657 per kilowatt hour (kWh) in a Notice of Resolution dated May 29.
CENECO acting general manager Arnel Lapore said with the ERC approval of the PSA he expects their power rates to go down by P1.50 to P1.80 per kilowatt hour in June and by P4/kWh in July barring any complications in the market.
The ERC’s action on the PSA application is expected to reduce CENECO’s generation rate amidst high electricity prices, as well as mitigate its exposure to the Wholesale Electricity Spot Market (WESM), where the electric cooperative is observed to be buying almost 74 percent of its supply, a statement from the commission said.
The grant of approval requires EDC to provide replacement power to CENECO, even during planned or unplanned outage, equivalent to the provisionally approved rate.
The ERC said the final generation cost that EDC can charge is still subject to review by the Commission. If the final approved rate is lower than the provisional rate granted, EDC is duty-bound to refund CENECO, and CENECO is also mandated to credit the same in the electric bills of consumers, the commission said.
Bacolod Mayor Alfredo Abelardo Benitez and Negros Occidental Acting Governor Jeffery Ferrer earlier called on ERC to take swift action to bring down CENECO’s power rates.
Benitez and Ferrer, in separate letters to ERC chairperson and CEO Monalisa Dimalanta, sought the issuance of the provisional authority that had been requested by CENECO and EDC in March yet.
CENECO has a 20 megawatts 10-year supply contract with EDC at P5.56 per kilowatt hour without Value Added Tax (VAT).
“It is of my understanding that one of the major reasons attributed to the increase of power rates is the inaction of ERC on the joint petition filed by CENECO and EDC, last March 15,” Benitez told Dimalanta in his letter.
Given that more than 60 days have passed since the filing of this petition clearly shows that ERC has not acted in a timely manner, which has resulted to the intolerable increase in power rates, Benitez said.*