ERC asks DTI to substantiate its petition

The Energy Regulatory Commission (ERC) has asked the Department of Trade and Industry (DTI) to substantiate its petition to lower electricity rates.

The ERC has directed the DTI to “supplement the allegations in its omnibus petition praying, among others, for the modification of the existing approved lifeline programs of the distribution utilities.”

The DTI earlier initiated the petition seeking ways to bring down the price of electricity, acting on a directive from President Arroyo during the recently-held Energy Summit.

In a letter, ERC general counsel Maria Corazon Ginez, asked the DTI to clarify in its omnibus petition the legal capacity and authority of the Bureau of Trade Regulation & Consumer Protection to file the petition on behalf of consumers.

The commission also asked the DTI to come up with the details of the proposed lifeline programs including the rate impact on the subsidized and on the subsidizing class, the basis for the determination of the lifeline threshold, and justifications for the adoption of such programs.

The ERC also directed the DTI to clarify the details, legal basis and justification for the power sector regulator to direct the Manila Electric Co. (Meralco) to buy from the wholesale electricity spot market at peak hours.

According to the ERC, the DTI should be able to come up with the mechanics for the proposed spot market trading of Meralco, and enumerate the benefit of such proposal to the consumers in terms of lower power rates.

Moreso, the ERC said the Trade Department should also come up with the details, legal basis, mechanics and justification for the preferential treatment for poor households and power-intensive industries in the distribution of the National Transmission Corp. (TransCo) charges by Meralco.

The ERC said the DTI should also be able to justify the legal basis, benefit and rate impact of prohibiting Meralco from charging system loss as a separate item.

It added that the DTI should show if there is a legal basis in its proposal for the ERC to peg Meralco’s rates at Visayas Electric Cooperative, Cebu Electric Cooperative and Davao Light and Power Co.’s rates, including justification for departing from the “cost of service” principle in rate-setting as contained in the Electric Power Industry Reform Act (EPIRA).

In addition to these directives, the ERC asked the DTI to publish its omnibus petition in compliance with the implementing rules and regulations of the EPIRA and the Supreme Court decisions on the matter.

“Much as the ERC would want to expedite its action on this petition, there are procedural requirements that the DTI has to comply with; otherwise, it may not be able to discharge its burden of proof during the hearings. Also, it is important for DTI to comply with the procedure in the EPIRA IRR, which as interpreted by the Supreme Court, is mandatory.” ERC chairman Rodolfo B. Albano Jr. said.

Under the ERC’s Rules of Practice and Procedure, the ERC shall return any petition received which is not in substantial compliance with its rules or any applicable statutes. Once returned, the petitioner may re-file the same after complying with all the requirements.