Meralco accepts PEZA rules on ecozone utilities
Donnabelle L. Gatdula
Philippine Star
Manila Electric Co. (Meralco) has withdrawn its petition to stop the Philippine Economic Zone Authority (PEZA) from implementing the guidelines on the registration of power generation facilities and other entities inside the economic zones.
Meralco president Jesus Francisco said the company’s board has consented to withdraw after resolving issues with PEZA.
“Our main concerns as a franchised distribution utility were addressed by PEZA,” Francisco said.
He said PEZA’s objective of lowering the rates for industrial customers is shared by Meralco. “We do share its objectives of helping ecozone locators become more competitive.”
The implementation of the guidelines would allow PEZA to bring down power rates in the ecozones by as much as P1 per kilowatthour.
The Regional Trial Court of Pasig earlier granted the petition of Meralco and Private Electric Power Operators Association Inc. (PEPOA) to issue a temporary restraining order (TRO) against PEZA and stop it from implementing the guidelines within the franchise area of Meralco.
The petition also questioned PEZA’s authority over the power distribution and power rate setting within the economic zones. The petitioners argued that under the Electric Power Industry Reform Act of 2001 (EPIRA), only the Energy Regulatory Commission (ERC) has the sole authority to regulate power rates.
Energy Secretary Angelo Reyes, for his part, welcomed the decision of Meralco and PEPOA as this will eventually redound to lower power rates in the ecozones.
“This is a welcome development and will benefit close to 300 locators in 13 ecozones in the country,” he said.
He said this will also help bring the country’s electricity rate at par with its Asian neighbors.
“It is a major step towards achieving competitive rates. This will send a positive signal to investors,” Reyes said.
It would be recalled that PEZA finalized the guidelines for the implementation of the P1 per kwh power rate reduction early this year and has asked utilities located in the ecozones to register with them to be able to avail of the rate cut.
But Meralco and the National Power Corp.? (Napocor) have also signed a memorandum of agreement (MOA) that would lower the cost of power by P1 per kwh at 10 industrial estates and three special economic zones.
Based on the MOA, the two power firms will lower the generation rate to P3.52 per kwh from the current P4.69 per kwh.
However, Francisco said if the volume of power sourced by the companies goes up to certain level, the generation rate can further go down to P3.49 per kwh to P3.46 per kwh.
Based on preliminary estimates, this could result to substantial savings of P1.17 per kwh to the industrial users.
The confusion cropped up when a Department of Justice opinion gave PEZA the authority to regulate the power utilities within its jurisdiction.
The DOJ’s opinion effectively removes the ERC’s authority over power firms operating within the zones.
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