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Author Topic: Bohol Light Wants Electricity Rate Increase  (Read 724 times)

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Bohol Light Wants Electricity Rate Increase
« on: December 07, 2011, 08:35:35 AM »
By Bohol Chronicle

The Energy Regulatory Commission (ERC) has set tomorrow, the public hearing of the application of Bohol Light Company, Inc. (BLCI) for the approval of the proposed rate adjustment as translation of the ERC-approved Annual Revenue Requirement (ARR) under the Performance Based Regulation (PBR) for the regulatory period 2012-2015.

BLCI General Manager Eulogio Signe explained that in their proposal, a consumption of 100kW based on the current rate costs P644.49, while under the proposed new rate it would be P671.03 with a difference of P26.54 as supposed increase per month which is still even lower than the average daily expenditure on cellphone load.

An estimated consumption of 500kW in the old bill is P3,127.13, and with the proposed new rate the bill would then be P3,186.99 or with a difference of P59.86/month which is still even affordable than a leisure drinking session, he added.

"In comparison to other private distribution utilities in the Visayas who are now using the approved Annual Revenue Requirement (ARR), among PECO, PROSIELCO, VECO, MECO and BLCI, it appears that BLCI has the lowest rate for residential and commercial rate, like for example, on residential customer class, the following rates are as follows, P10.89/kWh, P10.78/kWh P 9.19/kWh, P 8.15/kWh and P 5.98/kWh respectively even after with the proposed increased on the approved ARR for BCLI. For the Commercial Customer Class the rates for PECO, PROSIELCO, VECO, MECO and BLCI are P10.34/kWh, P12.39/kWh P 8.89/kWh, P7.80/kWh and 5.68/kWh accordingly," Signe explained.

This proposed rate increase is intended to improve BLCI services for the benefit of the entire valued customer in the franchise area, he said.

The Sangguniang Panlungsod had designated official representatives of the city government as intervenor in tomorrow’s hearing which will start at 2 p.m.

In the stalled hearing last September 20, BLCI Legal Counsel Michael Ancheta questioned the personalities of Councilors Nerio Zamora II, Doni Piquero, and Bebiano Inting who carried the stance of the city government but appeared on their personal capacities as consumers.

Ancheta pointed out then that the official intervenor is the "city government".

On this, the SP had adopted the recommendation of the Committee on Public Utilities to designate and authorize Councilors Zamora, Piquero, and Inting to represent and appear in behalf of the city government and the SP in the hearing.

This is in consonance to the committee's recommendation to authorize the city mayor to file a petition for intervention before the Energy Regulatory Commission regarding BLCI's application for approval of the proposed translation into distribution rates of different customer classes for the first regulatory year of the ERC-approved ARR under the PBR for the regulatory period 2012-2015.

Councilor Edgar Bompat, chair of the Committee on Public Utilities, passed separate resolutions for the two recommendations and the SP approved it last Friday.

The city government is also questioning how the joint venture agreement between the provincial government and BLCI was arrived at.

During the SP committee level hearing on October 5, the councilors pointed out that BLCI's application for rate adjustments has no basis, "considering that it would result to disparity of the rates for the residential consumers as against the commercial consumers who have greater energy consumption which in effect adds burden on the part of residential consumers".

In fact, Bompat pointed out in his committee report dated October 14, 2011 that "Republic Act 9136, otherwise known as the Electric Power Industry Reform Act (EPIRA) of 2001 was enacted to ensure the quality, reliability, security and affordability of the supply of electric power to ensure transparent and reasonable prices of electricity in a regime of free and fair competition,"

The Provincial Legal Office is also expected to represent the provincial government as oppositor during the hearing.

Signe also cited that Section 43(f) of the EPIRA law, and Rule 15, Section 5(a) of its implementing Rules and Regulations (IRR), authorized ERC to adopt alternative forms of internationally accepted rate-setting methodology.

"Now, therefore, emerged the PBR which serves as a rate setting methodology using a price cap to set the distribution wheeling rates to be charged by Distribution Utilities to its customers," according to BLCI.

On December 13, 2006, based on Epira Law, ERC approved Resolution No. 54-series of 2006 "Adopting the Rules for Setting Distribution Wheeling Rates (RDWR) for Privately Owned Distribution Utilities Entering Performance Based Regulation for the Second and Later Entry groups as MERALCO, CEPALCO and Dagupan Electric were the first.

Then ERC issued Resolution No. 10, Series of 2010, adopting the timeline for the Fourth Entry Group of Regulated Entities entering the PBR commencingon October 01, 2011 and terminating on September 30, 2015. The 4th Entrants are the following: Angeles Electric Corporation; Bohol Light Company Inc.; Clark Electric Distribution Corporation; Panay Electric Company; Subic Enerzone Corporation; San Fernando Electric Light & Power Company

On September 28 last year, BLCI filed an application for approval of ARR and Performance Incentive Scheme (PIS) with ERC under PBR regime.

Then on November 23 of the same year, a jurisdictional hearing, expository presentation, pre-trial conference and evidentiary hearings regarding the ARR and PIS Application of BLCI was made here at the franchise area held at the Governor's Mansion, Tagbilaran City

On June 8, this year, a public consultation was made by the ERC on the Draft Determination of BLCI's ARR and PIS Application, while on May 21, the Draft Determination of BLCI's ARR and PIS Application was posted on the ERC Web Site for further comments.

Last July 6, the ERC, in its Decision and Final Determination, approved BLCI's ARR and PIS Application presenting its final decision on the price control arrangements that will apply to BLCI for the Regulatory Period with the smoothened Maximum Average Price (MAP) of P1.02 from 82 centavos or an average increase of 20centavos.

The approved MAP will then be translated into rates for the different customer segment of BLCI such as Residential, Commercial, Public Buildings & Street Lights and Hospitals & Radio Stations. The translation of the approved MAP into rate by customer segment is still under application by BLCI with the ERC.

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