ERC urged to defer power rate hikes

MANILA, Philippines — It would be best for the Energy Regulatory Commission (ERC) to withhold the requests of power distributors and generating firms to collect higher electricity bills while the industry is on yellow alert due to high power demand this summer, a member of the House of Representatives said.

Rep. Dan Fernandez, vice chairman of the House energy committee, also urged the state-run agency to defer the requests while a December 2023 Court of Appeals decision favoring the Manila Electric Co. is pending before the Supreme Court (SC).

“While the appeal remains pending with the SC, I strongly urge the ERC to suspend and withhold approval of new PSAs between Meralco and the two SMC generating companies until the high court reaches a final decision on the case against their bids to increase electricity rates,” Fernandez said, referring to the power supply agreements between Meralco and South Premier Power Corp. (SPPC) and San Miguel Energy Corp. (SMEC) – two of San Miguel Corp.’s subsidiaries.

He added that it would be “better for the ERC to wait for the SC to render judgment on the controversial case involving the PSAs between Meralco and SMC so as not to preempt or render moot and academic its ruling on the matter.”

The congressman from the lone district of Sta. Rosa in Laguna emphasized the need for the OSG to elevate the case to the high tribunal as it involved the collection of higher power rates that would further burden consumers, who are already paying one of the world’s highest electricity bills.

SPPC runs the Ilijan gas-fired power plant, while the SMEC runs the coal-fired power plant in Sual. Both companies, along with Meralco, have asked the ERC to approve a 30-centavo rate increase for a new PSA.

“While demand for power supply is acute at this time, we also have the responsibility to protect consumers against price gouging. There are ways to meet the demand that will not unduly and unreasonably raise power rates,” Fernandez said.

Fernandez stressed that the ERC cannot just approve another PSA between SMC and Meralco without filing an appeal of the CA’s December 2023 ruling with the Supreme Court for final judgment.