ERC orders power distributors to wait for final IEMOP billing

MANILA, Philippines — The Energy Regulatory Commission (ERC) has directed distribution utilities (DUs) not to impose generation charges based on Wholesale Electricity Spot Market (WESM) preliminary bills.

In an order dated June 10, ERC told DUs within the Luzon and Visayas grids to wait for the final statement (FS) from the Independent Electricity Market Operator of the Philippines (IEMOP), the independent market operator of the WESM.

“This will ensure that the DUs’ billings to their customers will reflect the accurate values corresponding to (WESM) purchases,” the regulator said in a statement.

The ERC had suspended market operations for the Luzon and Visayas grids on various dates last month following a series of red and yellow alert notices.

During the intervals when the market was suspended, the administered price (AP) and the secondary price cap (SPC), in certain instances, were applied.

According to the ERC, the final billing is expected to be lower than the preliminary billing as this would reflect the implementation of AP and SPC in the WESM during the last supply month.

Asked for comment, Pangilinan-led Manila Electric Co. (Meralco) said it will comply with the directive and wait for IEMOP to release the FS to market participants before computing the final rates for June.

“With this, we also advise our customers to expect a slight delay in the delivery of their bills. We would like to give the assurance that these efforts are meant to mitigate the impact of the expected rate increase to all our customers,” Meralco spokesman and vice president for corporate communications Joe Zaldarriaga said.

The power distributor earlier said that it expects significant increase in the overall rates in June due to higher pass-through charges.

It said among these charges were the settlement costs in the reserve market and the increase in feed-in tariff allowance, all of which are expected to reflect in the bills of customers this month.

“To cushion the impact of the rate increase to our customers, Meralco initiated the coordination with its suppliers to defer a portion of their generation costs,” Zaldarriaga added.

Meralco said the deferred costs are proposed to be collected on a staggered basis for a period of three months, or until August, with the ERC having no objections on the proposed measure.