Lower power rates

The recent Senate hearings on the proposed amendments to the Electric Power Industry Reform Act (FPIRA) provided interesting revelations. The most startling revelation was the admission of Asisclo Gonzaga, president of the National Transmission Co., (Transco), a Napocor spin-off agency created under EPIRA, that Meralco and its customers are subsidizing part of the electric bills of the rest of the country.

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Napocor charges Meralco P0.40 more per kilowatt-hour than it bills other distribution utilities nationwide. There lies the subsidy. But why? Well, that is the price of bigness. There are burdens in government regulations called "intra-grid subsidy" which allow Napocor to charge Meralco higher rates so that it can offer low rates to the rest of the country outside Meralco’s franchise area, including Visayas and Mindanao.

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The good news is that this overcharge will be history when EPIRA is fully implemented. Under Section 74 of EPIRA, cross subsidies will be phased out three years from now. Meralco, through its vice president and treasurer, Rafael Andrada, assures that when the cross subsidies are removed, the bills of its customers will be automatically go down by P0.40 per kilowatt-hour.

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With all the bad news we have been getting on power rates, one good news deserves another. In addition tot he P0.40 per kilowatt-hour to be deducted when the cross subsidies are erased, Meralco is committed to slash P0.60 more per kilowatt hour from the electricity bill. But for Meralco to be able to do that, it has to be released from Napocor’s grip.

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It was established in the Senate hearings that Napocor holds Meralco by the balls, so to speak, on the matter of power supply. Meralco is bound by a 10-year power purchase agreement with Napocor under which it is forced to buy 90 percent of its electricity requirements from the state power firm, with the remaining 10 percent sourced from its two independent power suppliers (IPPs) – Quezon Power and First Gas.

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Before the Senate Energy Committee, Meralco disproved allegations that its IPPs charge more than the Nopocor. Factual figures spoke for themselves. Napocor’s selling rate is P4.40 per kilowatt-hour, Quezon Power sells at P3.30 per kilowatt-hour, while the price of First Gas is P3.80 per kilowatt-hour. Meralco assured that its IPP contracts can stand public scrutiny.

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Actually, Meralco can buy more volume from its IPPs if only they could operate full gear. But Quezon Power and First Gas are not allowed by Napocor to fully dispatch their production because of "transmission constraints." Under those alleged constraints, the two IPPs can only function, at best, at 70 percent capacity.

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But all along, Napocor has been insisting it has no "transmission constraint." During the past two weeks, in the heat of the power rate debate, Napocor has been assuring the public that its transmission problem are over. Then came the Luzon-wide blackout which, by Napocor’s admission, was caused by "failure transmission system." So, Napocor has "transmission constraints" after all. As to when these constraints would be remedied is anybody’s guess.

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If it can get out of the onerous 10-year power purchase agreement with the Napocor, Meralco, vows Andrada, would post hastily cut its rate by P0.60 per kilowatt-hour. As a matter of fact, Meralco is out of the agreement, having terminated the same September last year. But Napocor insists that Meralco cannot get out of the contract just like that. For its part, Meralco argues that the contract has been superceded by the EPIRA.

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Obviously, Napocor is protecting its own business interest in its row against Meralco on the power rates issue. Higher rates means better business for Napocor. And to think all along, we were of the impression that Meralco was trying to jack up electricity rates while Napocor was trying to full the rates down. The Senate hearings showed we were of the wrong impression.

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Milen Sison de Quiros has a warning bout credit fraud cheats. She said is a unique fraud issue going on right now in the credit card industry directly hitting credit cardholders, credit companies and banks.

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It is not the usual counterfeiting issue or big syndicate scam that manufacturers credit cards, because these swindlers need to take hold of the actual credit card first before they can perform illegal transactions. The new modus operandi operates with a bogus customer representative, usually using an alias of Joseph Santos or Joseph Natividad, calling unsuspecting cardholders and informing them that because of their "good credit standing they have been chosen to enjoy an increase in credit limit effective immediately."

Cardholders are told that all they have to do is surrender their existing credit cards to the messenger who would personally go to their house or office to pick up their old card along with other significant information such as cash advance and PIN. However, once the cardholder surrenders his old card he will never be able to get the replacement nor hear anything from these people. And later on he will end up with hundreds of thousands of fraudulent transactions charged to his card.

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Milen suggests that cardholders must be very cautious and not be easily persuaded by these con artists. Most credit cards have contact number and addresses at the back wherein cardholders can call for more information and check any promotion, so they better use it. They must also never give out their card to anyone, specially their PIN, because this will fail under "negligence" on the cardholder’s part.

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After the credit card company gave the card, cardholders are required to take full responsibility and security of it. Besides, most promotions of credit card companies do not necessitate cardholders to return the old card anymore, they just simply give the cardholders a new one.

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Milen said that today’s our economy is having a tough time and Filipinos are easily won over by this type of modus operandi. But, we should not allow these swindlers to fool us and we should not encourage them to believe that cardholders can be easily swayed. "Take time to analyze any promotion offered via phone or even e-mails and traditional mails, this could save you from such distress after all," Milen stressed.

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Thoughts For Today:

Thank God for this beautiful day.
Ask not for an easy day
but for His guidance and strength
and the courage to face the challenges of life.

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May today there be peace within you. May you trust
God that you are exactly where you are meant to be.
"I believe that friends are quiet angels who lift
us to our feet when our wings have trouble
remembering how to fly."

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My e-mail addresses: [email protected] and [email protected]