VISAYAN Electric Company’s consumers have again urged the Energy Regulatory Commission (ERC) to explain the alleged questionable charges and exorbitant electricity prices to the company in the bills.
Consumers, along with the Philippine Movement for Climate Justice (PMCJ) and other Visayan Electric stakeholders, made the appeal during the public symposium called “Why are Cebu City Electricity Prices Expensive?” At the Visayas University main campus in downtown Cebu on Saturday, May 28, 2022.
City councilor and minority leader Nestor Archival, one of the speakers during the symposium, said he was asking ERC to explain to consumers why electricity prices are so high in Cebu.
He said that ERC appeared before city council via Zoom a month ago, questioning 21 charges included in consumer bills. But there was not enough time for a comprehensive discussion.
“We keep questioning because we have no way of asking them to back off [the rates] But we keep asking [them] He said in a mixture of Cebuano and English.
When asked if the city council had also called on Visayan Electric to explain the matter, Archival said the company only said it only followed the law.
“My view is that the Emergency Relief Coordinator was the one who agreed to [charges]. So every time they’re going to file the invoices or the fees, and whatever they’re going to implement, they’re going to submit it to ERC,” he said, adding that they had no idea how long the ERC would review or approve the changes.
But Archival, an electrical engineer for nearly 40 years, said ERC couldn’t feel the burden for ordinary consumers.
“That is why we are all, to me, at the mercy of utility [Visayan Electric] Because it is the Equity and Reconciliation Commission that conducts the review,” stressing that he will support consumers if they petition to review the charges.
Archival said there is also a need to amend some parts of the Electric Power Industry Reforms Act 2001 (Epira Act or Republic Act 9136), citing Section 45B that does not speak of the need for competitive bidding for power supply contracts.
The concept of “no joint ownership” was also not embodied by law because it permitted bilateral contracts between generator and distribution facilities that are related parties or sister companies.
Visayan Electric, co-chairman and attorney, Aaron Pedroza, said that Visayan Electric sources more than 50 percent of total energy demand from its generation companies, which is a violation of Ibera law as it prohibits it from acquiring sources above the mentioned percentage.
Pedroza said they want to challenge the overcharging and illegal charges against Visayan Electric by writing to ERC.
“For too long, it has been treated as something technical but one can experience the high power rate,” Pedroza said, referring to the “illegal collections” of capital redemption fees by Visayan Electric to run its own power generator – Cebu Private Power Corp. (CPPC) from 2013 to 2021 although there is no Power Supply Agreement (PSA).
He said the public service agreement between the distribution facility and the CPPC actually expired in 2013 or ended in its natural demise by virtue of the expiration of the 15-year period since it entered into the agreement in 1997.
The CPPC power plant was constructed by the East Asia Diesel Power Corp of Visayan Electric under a 15-year build-operate-transfer scheme of cooperation which ended in November 2013.
In an earlier report, Visayan Electric entered into a new supply contract with CPPC for another 10 years, which was approved by ERC.
However, the power distributor suspended the CPPC contract in August 2021 after stating that its price is the most expensive among all power suppliers.
Raul Lucero, Visayan Electric’s president and chief operating officer, said earlier that they have turned to the spot market for wholesale electricity for power generation even though their prices change hourly.
Pedroza, who is also the general secretary of Sanlakas, said they should be held accountable for this regardless of Visayan Electric’s continued sources of power supply at its sister companies.
He added that the challenge is not only for consumers but also for local government units within the Visayan Electric concession area including the cities of Cebu, Mandaue, Talisay and Naga and four municipalities in Liloan, Consolacion, Minglanilla and San Fernando.
Pedroza said the first business or agenda for newly elected or re-elected government officials should include looking at how electricity prices should not increase amid the increase in commodity prices and the economic crisis caused by the Covid-19 pandemic.
Once that issue is resolved, he said, the alleged illegal collections due to the CPPC-Visayan Electric arrangement of 7.2 billion pesos will be returned or refunded since 2013.
The biggest step, Pedroza said, is to engage ERC, Visayan Electric and other stakeholders in the community so that they realize they can no longer go unresolved with these issues.
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