DOE, DOF sign implementing rules of Murang Kuryente law

Power consumers can look forward to lower electricity bills after the Energy and Finance departments signed the implementing rules and regulations (IRR) of the Murang Kuryente Act.

In a statement, the Power Sector Assets and Liabilities Management Corp. (PSALM) said the IRR for Republic Act No. 11371 or Murang Kuryente law have been signed by Energy Secretary Alfonso Cusi and Finance Secretary Carlos Dominguez III through Joint Circular No. 1, Series of 2020 to operationalize the measure.

On August 8, President Rodrigo Duterte signed the Murang Kuryente Act. 

The law sets aside P208 billion of the government’s share in the net proceeds from Malampaya gas-to-power project to pay for the National Power Corporation’s (NPC) debts through the universal charge for stranded debts (UC-SD) and stranded contract costs (UC-SCC) incorporated in the monthly electricity bills of power consumers.

Sections 2.4 and 9.1 of the law’s IRR state that no new universal charges (UC) for SCC and SD shall be collected upon effectivity of the implementing rules.

Section 9.2 provides that, "PSALM shall not file with the ERC (Energy Regulatory Commission) any new petition for UC stranded contract costs and stranded debts until the P208 Billion allocated amount under this Act [MKA] is exhausted and no other allocations are made by Congress."

The Implementing Rules and Regulations (IRR) for the MKA as contained in the Department of Finance and Department of Energy Joint Circular No. 1, were approved in consultation with the Department of Budget and Management, the Bureau of the Treasury, and PSALM.

"We are glad that the IRR has finally been signed. This gives consumers relief from paying an estimated total additional amount of P0.86 per kilowatt-hour of UC SCC and UC SD covering up to year 2024,” PSALM president and CEO Irene Besido Garcia said.

The estimated P0.86/kWh is the estimated total UC SCC and SD covering the UC petitions of PSALM pending in the Energy Regulatory Commission at the rate of P0.3007/kWh and the future UC petitions of PSALM that it will file with ERC with impact of P0.5593/kWh.

For a household consuming 200 kWh electricity, this translates to about P172.00 of monthly savings from reduced electricity rates, or an annual savings of P2,064.00.

The ERC-approved UC-SD of P0.0428/kWh and UC-SCC of P0.0543/kWh or a total of P0.0971/kWh were being collected from all electricity end-users. However, effective February 2020, the collection of the UC-SCC ceased in view of the full recovery by PSALM of the ERC-approved amount for SCC. 

Thus, only the UC-SD at the rate of P0.0428/kWh is currently being collected from all electricity end-users.

The IRR outlines the documentary requirements, timeline, responsibilities and functions of concerned agencies tasked to implement the law. 

In particular, it specifies the processes of determining the annual allocation from the Malampaya fund through the General Appropriations Act, consistent with the fiscal program of the government, and the releases of approved amounts to PSALM for the payment of its SCC, SD, and corresponding anticipated shortfalls. 

PSALM is tasked to ensure consistent record keeping of disbursements and report the utilization of the fund to oversight agencies including the ERC and the Joint Congressional Energy Commission.

The IRR shall take effect 15 days from the date of its publication in the Official Gazette or in a newspaper of general circulation. —KG, GMA News