Manicurist Marilyn will have to brace for higher power rates

CONSUMERS should start saving more money for their coming electricity bills.

The Power Sector Assets and Liabilities Management Corp. (PSALM) and the National Grid Corporation of the Philippines (NGCP) both have pending petitions before the Energy Regulation Commission (ERC) to increase their power rates.

Created in 2001 under EPIRA to manage the sale of National Power Corporation’s (NPC) assets and restructure its debts, PSALM has recently proposed fresh rate hikes.

The Times report on August 24 by Euan Añonuevo said this new round of increases are to cover the fuel and foreign currency exchange costs of National Power Corp.

In a petition before the Energy Regulatory Commission (ERC), PSALM sought a rate increase of P0.11 per kilowatt-hour in Luzon and P0.12 per kilowatt-hour in the Visayas.

If the ERC approves the petition, the rate hike would allow PSALM to pay for the fuel and foreign exchange costs worth P2.81 billion in Luzon and P2.12 billion in the Visayas that Napocor and its contracted independent power producers incurred.

This request covers the billing period March 2010 to February 2011.

Aside from the rate hike in Luzon and Visayas, PSALM is asking ERC to reduce power rates in Mindanao by P0.03 per kilowatt-hour to allow Napocor to refund P858.20 million in over recoveries in the region arising from the fuel and forex costs.

Earlier, PSALM filed a petition before the ERC for a P0.36 per kilowatt-hour rate increase to recover P74.30 billion in stranded contract costs that Napocor incurred.

PSALM also had sought to collect P0.39 per kilowatt-hour as universal charge to pay for Napocor’s “stranded” obligations.

PSALM had asked the ERC to charge consumers P0.03 per kilowatt-hour over 15 years for the stranded debt, and another P0.36 per kilowatt-hour for the stranded contract costs that will be left with Napocor’s books.

The stranded contract cost is the excess of Napocor’s contracted cost of electricity with independent power producers over the actual selling price of the contracted output. Stranded debts pertain to Napocor’s unpaid financial obligations in excess of the proceeds from its asset sale.

NGCP, on one hand, wants an increase in its transmission charges because its insurance does not cover the damage to its transmission assets caused by typhoons “Ondoy” and “Pepeng” and the bombming in Lanao del Norte.

When firms’ losses are passed on to the poor

Should the ERC approve the proposals, the losses of NGCP and PSALM will be passed on to millions of consumers like Marlyn Pakingan of Las Piòas City. With three sons to feed and send to school, Marlyn has no other livelihood but to give manicure and pedicure.

Her husband is a tricycle driver who earns P130 daily after paying the boundary. To make ends meet, Marlyn has to earn at least P300 pesos every day. This means she has to clean 12 hands or 12 feet, and she has to walk through the streets of three villages to find customers.

But there are times she couldn’t find even one customer, and this is a big problem for her. “Gipit. Hindi ko alam kung anong gagawin ko,” says Marlyn. “Minsan nangungutang na lang ako sa tindahan ng pagkain namin. [Really tight. I don’t know what to do. Sometimes I just resort to buying our meal on credit from the store.] ”

Marlyn says her family’s daily expense in food alone is P180 at the least. The school allowance of her second son and youngest son is P70; the eldest no longer goes to school because Marlyn and her husband cannot afford the boy’s college education.

It is also hard for Marlyn to raise P1,500 for house rent. Add to that their average monthly electricity bill, which increased from P400 to P650 in just a few months time, yet their only appliances are a 14-inch TV, an iron, an electric fan, and two fluorescent lamps.

Marlyn says had there been no power rate hike, she could have bought more food for her children. “Kung gagawin kong bigas ang kuryente, ang P650 ay maibibili ko ng bigas na aabot sa mahigit dalawang lingo. [If I could turn electricity into rice, P650 could buy rice that will last us more than two weeks ” she adds.

But recently, Marlyn was billed P1,397 because a neighbor pilfered electricity from her line. She had no choice but to borrow money.

When her neighbor pilfered from her line, her charges for generation, transmission and distribution were P703, P137 and P308, respectively. The government taxed her P133, while her subsidy was only P20 and this was sourced from her fellow power consumers.

Marlyn admits that she doesn’t understand any of these charges. She doesn’t even know why she is being charge P87 for system loss.

Maybe if she comes to understand that this is her share to help electricity firms recover the cost of electricity that they lost during transmission so that their business would not lose millions, she would also come understand why she has to clean another pair of feet. But maybe not. –CLAIRE MERCADO WRITER-RESEARCHER, Manila Times