Energy Regulatory Commission (ERC) chair Francis Saturnino Juan has reiterated the need for a reset in several components of electricity bills, saying rules for the rate-setting process are now being reviewed and new rates will be in place by 2025 or early 2026.
Transmission, distribution, and generation charges have been part of the items that power consumers pay for over 10 years now, with the latter accounting for the biggest share in the electricity bill, Juan said in an interview over the Bagong Pilipinas Ngayon program on Friday, August 22.
He explained that ERC has opened the generation charges for competition to ensure that consumers will pay the lowest rate.
To make sure that generation charges will be low, regulators have to make sure that providers have adequate capacity, thus, the improvement in the process for investors to put up power plants and have the needed supply, he said.
In terms of the transmission and distribution, Juan said these have always been regulated, but the last review was done more than 10 years ago.
“And that’s why I don’t know if the rates they are collecting are more than or less than what it should be,” he said.
Juan said they have started reviewing the rules for the rate-setting process, which need to be promulgated to have a clear and streamlined process as soon as possible.
He said the hearing must finish before the distribution utilities and power cooperatives start a new regulatory period.
He said ERC has been working to put the new rates in place by 2025 or early 2026.
He underscored the ERC’s mandate, aimed to ensure that there will be adequate power supply, and reliable transmission and distribution capacities to service the consumers at competitive rates.
When Juan took over as ERC chair on August 14, he pushed for the resolution of around 5,000 pending cases before the regulatory body. These cases include the rate reset of private distribution utilities, implementation and resets under the Rules for Setting Electric Cooperatives’ Wheeling Rates, capital expenditure applications, approvals of Power Supply Agreements (PSAs), including Emergency PSAs, applications for point-to-point lines, dispute resolutions, rule-making, other rate-related cases, and unreleased show cause orders.
Juan said that to act on these cases within target timelines, each of the five ERC commissioners have been assigned as oversight heads for specific services.
“The ERC means business. So, we, at the Commission, have assigned specific oversight responsibilities so that every case gets the attention it deserves. All cases are important: nothing is too small nor nothing is too big,” Juan then said.
The ERC operates as a quasi-judicial body that mainly decides on applications and cases that will affect power rates in the country.
