Governor Art Yap Of Bohol and ERC Chair Justice Agnes Devanadera after the conclusion of the two day joint fact finding hearing which were held in the Energy Regulatory Commission offices in Ortigas Center, Pasig City this afternoon. For two days, the Bohol Delegation led by Governor Yap and First District Congressman Edgar Chatto and Representatives of the Distribution Utilities Of Bohol questioned the bases for the sharp rate increases experienced by Boholanos in May and June this year. The DUs reasoned that the combined effect of high transmission costs and high power rates purchased from the electricity spot market when Bohol breached its power demands over 90 megawatts, is to blame. Under intense questioning from Governor Art Yap, it was established that the rates charged to consumers were excessive and inequitable necessitating a recomputation and refund of rates. Governor Art Yap was able to show that the formula used to charge consumers for the excess in power consumption was inequitable as it was being charged on the total consumption power demand and not on the excess power demand. Unless a suspension of the rates and a reimbursement was effected, it was clear that the Provincial Government would not have any recourse except to bring the matter to Court and seek the reimbursement for the charges. ERC Commissioner was sympathetic to the plight of Bohol and admitted that the charging formula was not equitable for which reason, via common consensus of the parties, it was agreed that: 1) the billing for July will be suspended pending recomputation and reimbursement through a “net settlement surplus” computation that will be returned to all affected consumers while the May and June charges will be reimbursed in time. However, the power that was actually used using the actual electric spot market charges will be applied and must be paid as that power was actually used by consumers. At that rate, a possible 50 percent of the increases power charges collected will have to be returned to consumers. 2) NGCP also agreed to fast track the completion of the Cebu/Bohol line to add another transmission highway to Bohol apart from the Leyte Bohol transmission line. 3) another option is to now allow the DUs to directly contract with NGCP for the direct contracting of the ancillary or excess 7 MW capacity of the in-island system. This capacity can be sourced from a power barge in Bohol and will not need to be subjected to very high transmission charges even as the diesel will be subjected to possible higher charges that the contracted rates. Moving forward, Governor Yap has instructed the DUs to improve their power sourcing beyond the WESM which is now the source of more than 40 percent of Bohol’s power even as he will continue to pressure the ERC, the NGCP and the WESM to correct the Line Rental rates to be more equitable in the charging for its use. Bohol’s efforts in seeking a better or equitable charging formula for the transmission lines will benefit not only Bohol but all DU’s nationally for which reason the resolution of this problem is being watched closely by many quarters. Suffice it to say that Governor Yap’s pro-active stance in representing the grievances of Bohol’s consumers resulted in suspending the next power bill and a roll back in the charges being imposed. Significantly, with these changes in the transmission charges, the effects of redressing the grievances of Bohol’s consumers will eventually redound to the benefit of power consumers nationally. Already, ERC Chair Devanadera is hailing the problem solving exercise as a model that can be adopted by the ERC and LGUs elsewhere as efforts to correct longstanding structural defects in the power sector are addressed. #buhatangpasultion
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