The Energy Regulatory Commission (ERC) is backing the Land Bank of the Philippines’ new lending program that aims to cushion the impact of higher electricity rates on consumers.
“The ERC extends its deepest gratitude to the Land Bank of the Philippines for responding to the call for help in ensuring the availability of sustainable and affordable energy for electricity consumers,” ERC Chairperson Monalisa Dimalanta said in a statement.
On Wednesday, Landbank announced that it launched the P1.5-billion “ANTI BILL SHOCK” Lending Program last week.
ANTI BILL SHOCK stands for “Assistance to Narrow and Trim down the Incremental power cost increase via Bridge financing Initiative of Landbank to Lower and Spread out HOt summer-triggered monthly Consumption on Konsumers’ Electricity," it said.
Dimalanta said Landbank’s program is “one of the best examples of what we can accomplish together is adopting a whole-of-government approach: those of us in the energy sector working hand-in-hand with our counterparts in the private financing sector in finding solutions to provide some much-needed relief for our consumers.”
The program provides a credit facility to distribution utilities to help augment their working capital, especially during the summer months when, historically, a spike in consumers’ electricity consumption occurs.
During the summer season, consumption patterns spark higher electricity demand, which results in an increase in market price, according to the ERC.
The short-term loan facility will require borrowers to implement an anti-electric bill shock program to protect their respective clients from the expected increase in electricity bills.
Landbank said the arrangement would enable the distribution companies to spread out the incremental increases in their customers' billings by up to nine months without passing on the borrowing cost to consumers. —VBL, GMA Integrated News