Subic Enerzone seeks substantial rate increase

MANILA, Philippines – Residential customers of Subic Enerzone Corp. (SEZ), owned and operated by the Aboitiz Power Corp. (APC), will have to pay more starting 2012.

In a petition filed with the Energy Regulatory Commission (ERC), SEZ asked for an increase in electricity rate that would be consistent with the power distribution firm’s capital expenditure from 2012 to 2015.

Based on its petition, SEZ’s annual revenue requirement would be P399.37 million in 2012; P414.60 million in 2013; P435.94 million in 2014; and P455.23 million in 2015.

According to SEZ, these amounts would be utilized to finance its capital, operating, maintenance and tax expenditures.

These amounts would also cover the forecast foreign currency exchange rate and consumer price index movements over the said period.

The firm used a projected power demand growth in its franchise area of 3.5 percent.

Under the proposed capex plan, SEZ wants maximum annual price increases of P1.36 per kilowatt-hour for 2012, P1.67 per kilowatt-hour for 2013, P2.05 per kilowatt-hour for 2014 and P2.54 per kilowatt-hour for 2015.

SEZ’s proposed tariff as against the existing rates would be: residential customers would increase from P2.17 per kilowatt-hour to P4.70, P4.72, P4.79 and P4.83 in 2015.

Commercial customers from P1.15 per kilowatt-hour to P2.48, P2.49, P2.53 and P2.55.

Industrial customers from P0.73 per kilowatt-hour to P1.33, P1.34, P1.36 and P1.37, respectively, from 2012 to 2015.

SEZ said these rate hikes are necessary to maintain the reliability of its system.

“Applicant most respectfully requests for approval of this application to allow it to fulfill its obligations under Performance Based Regulation and in order to avoid irreparable losses which will ultimately result in the deterioration of its services, to the damage, and prejudice of the public, in general, and its consumers, in particular,” it said.

SEZ said revenue application forms part of a rate of return of 15.01 percent per year. It said these proposed revenues are within the bounds of the required cost of capital allowed by the ERC.