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Amid the word war between government and the Manila Electric Co. (Meralco),
businessmen are demanding to know why the power rates in the country
are so expensive.
In a press release Monday, the Philippine
Chamber of Commerce and Industry asked the National Power Corp. (Napocor),
Meralco, the National Transmission Co. (TransCo) and the Energy
Regulatory Commission to clarify to the public the “raging
controversies” surrounding the issues on system losses,
overcharges, rate making and other costs passed to the consumers
resulting in unreasonably high power rates.
Power rates in the Philippines are reportedly
the second highest in Asia after Japan. The Lopez Group, which
controls Meralco, the largest power distributor in the country,
blames government taxes and other surcharges. Critics, led by
Winston Garcia of the Government Service Insurance System (GSIS),
accused the Lopezes of mismanagement and of violating laws to the
detriment of consumers.
“The only thing that people want to hear is
how we are going to lower our electricity costs,” Donald Dee, the
chamber’s chairman emeritus, said in the statement.
“Now is the time for the energy players to
explain to the people the systems, structures, procedures, contracts
and processes involved in power generation, transmission and
distribution,” he added. “For decades now, the public has
absorbed the high cost of power without them having a thorough
understanding of the economics of these power players.”
The chamber wants many questions answered.
“First, there is a need to review existing
‘systems loss’ provisions in the Epira [Electric Power Industry
Reform Act] allowing Meralco to recover 9.5 percent of its losses
due to pilferage, technical and administrative systems losses,”
Dee said. “Losses due to pilferage should not be charged to the
people, but rather should be considered as an operating expense for
Meralco. If you are allowed to charge these losses to the consumers,
there will be no incentive on the part of Meralco to correct its
inefficiencies and improve its patrol mechanism.”
The chamber also wants Meralco to explain its
reported practice of passing on to consumers its own electric
consumption, which is about 72 million kilowatts per year and worth
some P450 million annually. “Is this amount compatible with the
allowed percentage under the law?” Dee asked.
“Third, Meralco should honestly and urgently
refund all the overcharges and all the costs that it passed on to
its consumers.”
In the same press release, Edgardo Lacson, the
chamber’s executive vice president, said, “There is not much
time left before investors start veering their sights aggressively
somewhere else. The energy players must develop a roadmap that will
bring the power rate not only significantly lower but also
competitive in the region for businesses to continue to thrive.”
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