Napocor applies for rate rebate, denies it overcharged in the first place

MANILA, Philippines- Although still insisting that it did not overcharge its customers by P10 billion the past two years, the National Power Corp. on Monday submitted a rate adjustment application that will give power consumers reduced rates in the coming months. In an application with submitted to the Energy Regulatory Commission, Napocor asked for adjustments that would reduce the a Luzon consumer's power bill by P0.4047 per kilowatt-hour, and a Mindanao consumer's bill by about P0.0039 per kWh. Napocor said the adjustments will be made on its generation rate adjustment mechanism and incremental currency exchange rate adjustment mechanisms for the July 2006 to March 2008 period. The ERC, in an earlier statement, accused Napocor of adjusting these same mechanisms upwards without government approval, causing it to technically overcharge its customers by P10 billion. The GRAM and ICERA are ERC-approved adjustment mechanisms that cover a utility's expenses for purchased power, fuel costs and foreign exchange fluctuations. They are revenue-neutral, which means that the utility, like Napocor, does not earn any revenue from its implementation. However, despite this ERC statement and its own subsequent application for downward GRAM and ICERA adjustments, Napocor is firm that no overcharging took place. According to Napocor it just recently received approval from the Napocor board that paved the way for the filing of the application for the GRAM and ICERA adjustments. "We have always been compliant with all orders, resolutions, policies and statutes, not only those that arise from the ERC, but from all government agencies that monitor, regulate and control our operations," Napocor said. Napocor also noted that while its Luzon and Mindanao consumers will enjoy lower rates, those in Visayas maybe seeing higher power prices in their next monthly bills. "There are no other sources of electricity in the Visayas other than the geothermal plants in Negros and Leyte, and land-based diesel power plants, which comprises a big chunk of the generation mix. For Visayas, Napocor said, the combined GRAM and ICERA application will result in an upward adjustment of P0.159 per kWh if approved by the ERC. "These are expenses that Napocor has already advanced and made. Unlike other utilities such as power distribution utilities and electric cooperatives where the collection from their customers of these adjustments are automatic, it takes Napocor at least one year before it can collect or provide rebates from these adjustment because it still has to file for their applications before the ERC," the company said. - GMANews.TV