One more case of ERC supporting corporate greed

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A LAWYER has championed us electricity consumers against the corporate greed of renewable energy producers in their bid to collect money from us for electric power “that has yet to be generated by power plants that have yet to be built.”

Our hero is Lawyer Remigio Michael Ancheta. On Tuesday he petitioned the Supreme Court to stop the Energy Regulatory Commission (ERC), National Transmission Corp. (Transco), National Renewable Energy Board (NREB) and Manila Electric Co. (Meralco) from collecting from us consumers P0.406 per kWh we use to support companies building –or promising to build — wind, biomass, solar and hydro-electric facilities.

The additional payment we have to make this month to Meralco is the so-called Feed-in Tariff Allowance (FIT-All) charge that the government’s TransCo (the national electric power transmission corporation) imposes on us, under an Energy Regulatory Commission order issued on October 7 last year.

Mr. Ancheta is petitioning the High Court to nullify the ERC order for being unconstitutional.  He is asking for a temporary restraining order on the ERC order which is already in operation and Meralco will begin — or has begun– to carry this month.


“Unless this Honorable Court strikes down this unreasonable and oppressive attempt to collect from the public an amount that they can otherwise use for basic necessities, the consumers will be required to bear the burden by the start of year 2015,” he said.

Renewable energy is definitely better for us Filipinos — and mankind — than power produced from coal, diesel and bunker oil.  The more electric power we use produced by renewable energy facilities, the less dependent we are on imported oil for our generating plants and the less pollution we contribute toward the destruction of our environment.

The problem is, Lawyer Ancheta explains in his petition, the consuming public is being forced to finance the FIT-All ["All” for "allowance”] system established for private corporations that have promised to build RE production facilities.

The FIT-Allowance was set up under the 2008 Renewable Energy Act to help achieve the goal of making us Filipinos use RE instead of power from fossil fuels. It “offers guaranteed payments on a fixed rate per kWh for [to][to]ging renewable sources, excluding any generation for [the[the companies’]use.”

ERC’s order gives Transco the authority to handle the collection of the FIT-All money.

Transco then uses Meralco and other distributors to collect from us consumers.  The aim is “to ensure that the FIT-All Fund is sufficient to pay all renewable energy producers regularly.”

Transco is also authorized to build a buffer fund to supply “working capital requirements
[of [of the private companies that own RE producing facilities]ase some customers default or delay in their obligations to collect and remit the FIT-All proceeds,” Lawyer Ancheta’s petition states, quoting the ERC’s FIT-All rules and guidelines.

Lawyer Ancheta argues that the “laudable”  renewable energy law never envisioned the collection of the FIT-Allowance in advance from consumers.  The ERC, his petition invites the SC justices to believe, had “erroneously provided” this advance collection under the rules and guidelines it wrote.

“The FIT-All will require the consumers to pay in advance of their actual consumption regardless of whether the projected renewable energy plants are constructed and without any renewable energy actually being produced,” Mr. Ancheta states.

In the lawyer’s estimates, a household with an average consumption of 200 kWh per month would be made to pay an additional P8.12 to cover the FIT-Allowance charge.

Lawyer Ancheta estimates that Meralco, for Transco, would be able to collect about P2.76 billion in 2015.

We find that the ERC “error” is not really one. It is an ingenious way for this government regulatory body to once again work on the side of the business and industrial interests, to ensure their profitability at the expense of the people.

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3 Comments

  1. The feed in Tariff is a preset rate per kilowatt that can be charged and collected from consumers of power generated from renewable sources. It is meant to be an incentive to encourage investors to build plants using renewable and non-pollutive fuel link solar, hydro or geothermal energy. What is clear is the tariff will be charged and collected only when there is already a plant in operation and consumers at already actually using the renewable energy and not before. What the ERC proposes to do is smilar to the scheme of many condo builders popularly referred to as “pre-selling” where buyers are paying in advance for their condo units still to be built. At least in condo pre-selling there is already an area and plans the a buyer can examine unlike in this case of ERC where no investor or plant site is yet identified and the FIT is already being collected. What happens if no such plant is developed where will the money go? I have been wondering why petilla who is from Leyte has not talked anything about the geothermal energy development in Biliran, Leyte which should be about finished b this time. He insists that we are facing a crisis on energy this year and yet no mention is made of this plant that should be fast tracked with all assistance from him who is even a Leytenyo. Instead this government comes up with crazy ideas like this ERC “pre-selling” scheme of a pipe dream still in limbo. I commend and support the opposition of Atty Ancheta let contnue our vigilance against this corrupt and inane regulators.

  2. P. Akialamiro@yahoo.com on

    This is a very laudable move by Atty. R. M. Ancheta. Should he plan to establish a Consumer Protection Agency which is really needed in the Philippines, I would be glad to join his group as one of his advocates and legal counsels. Right on, ‘Panyero’.

    • I am just an ordinary electrical engineer with an extensive experience in telecommunications.I will also volunteer my services to Atty. Remigio if he needs someone like me. God Bless!!!!