MANILA, Philippines — State-run Land Bank of the Philippines is allocating an initial P1.5 billion to aid power firms cushion the impact of high electricity charges on consumers.
Landbank is starting a new credit facility through its Anti-Bill Shock program that aims to help households temper electricity bills this summer by assisting power utilities.
The facility was crafted with the help of the Energy Regulatory Commission and the National Electrification Administration.
Under the new lending program, Landbank will provide financing to electric distribution companies at concessional rates, with no additional spread on their working capital.
Cecilia Borromeo, who was still sitting as Landbank president and CEO when the program was conceptualized, said the arrangement would enable distribution companies to spread out the incremental increases in their customers’ billings.
This could be done by up to nine months without passing the borrowing cost to consumers who cannot afford to pay at full cost.
As state weather bureau PAGASA warned that warm weather is expected to prevail, power consumption is likewise seen increasing over the next few months.
Under the short term loan facility, borrowers will be required to implement an anti-electric bill shock program to protect their respective clients from the expected increase in electricity bills.
“Landbank aims to provide consumers more breathing room to pay their energy bills by helping prevent a price surge on their monthly expenditures,” Borromeo said.
“We are also committed to boosting the capacity of energy players to provide sufficient, accessible and reasonably priced supply of electricity nationwide,” she said.
Power distributors may loan up to 80 percent of the incremental increase on the working capital requirement during the summer months.
However, it should not exceed the repayment capacity of the distribution utilities or three times the average billings of its power suppliers.