Meralco refutes Enrile’s accusations

The Manila Electric Co. (Meralco) denied yesterday the "sweeping" accusations of former Sen. Juan Ponce Enrile against the power company, particularly his statement that it has been "fleecing its hapless customers."

"The highly regulated nature of public utilities like Meralco is in itself a safeguard against the overcharging, abuse or profit manipulation scheme alleged by the former senator," said Me—ralco’s corporate secretary and general counsel Camilo Quiason in a statement.

Quiason, a former justice of the Supreme Court, said Meralco has to secure prior approval from the Energy Regulatory Commission (ERC) for changes in its rates, terms and conditions of service, capital structure, major additions to its rate base, appraisal of its assets and contracts with independent power producers (IPPs), among many other petitions.

For some of these petitions, regulatory approvals can only be given after due notice and hearing, affording Meralco customers the opportunity to air their views on the matter before the ERC, Quiason said.

Even while he said that the ERC, and not the media, is the proper forum for lodging Enrile’s sweeping accusations, Quiason provided the following information in answer to Enrile’s allegations:

• Meralco has not overcharged its customers. All the charges (including the purchased power adjustment or PPA) appearing in its customers’ bills are legitimate, with basis, and may be verified with the ERC. It is also a matter of record that the Court of Appeals, in its Feb. 24, 1999 decision, completely reversed and set aside the Energy Regulatory Board’s 1998 decision ordering Meralco to refund its customers. The case has been elevated to the Supreme Court where it is still pending.

• Meralco has not had an increase in its distribution charges since February 1994. Its application for a 30-centavo rate increase filed with the ERB in April 2000 is still pending at the ERC where it has been consolidated with Meralco’s application for rate unbundling as required by Republic Act 9136. Public hearings are still ongoing on the consolidated petitions which, over a period of 28 months, have already logged more than 50 hearing dates.

• Despite the steady decline in its return on rate base (RoRB), Meralco invested P51 billion over the past eight years in expanding and upgrading its electric distribution system. During this period, Meralco built almost three new substations per year and added more than 3,200 circuit-kilometers of primary distribution and sub-transmission lines to its system. These improvements provided electricity to over 1.5 million new customers, brought down the frequency and duration of brownouts, and reduced system losses.

• As a result of Meralco’s aggressive electrification programs, access to electricity is among the highest in Meralco’s franchise area at 97 percent of total households, more than double the level in non-Meralco areas. Meralco’s Depressed and Rural Electrification Programs benefited over half a million urban and rural households. Yearly, some 120,000 new residential customers are being added to Meralco’s customer base.

• Meralco’s socialized rates continue to make enjoyment of a vital service as electricity affordable to marginalized sectors within its franchise area. Residential customers consuming within 50 kWhs per month, numbering close to 700,000 or 17 percent of Meralco’s residential users, pay P6.50 per day for electricity, the equivalent price of one can of sardines. Those consuming within 51 to 100 kWhs per month, which number another 800,000 customers, pay no more than P16 per day, the equivalent of one broadsheet.

"We have never taken our public utility status as a ‘license to inflict pain to hapless consumers.’ Constrained as we are in terms of finances, Meralco has never reneged in its commitment to provide efficient and reliable service to its close to four million customers," Quiason said.

"It is (Meralco’s) commitment marked by close to 100 years of service," he added.