THE National Electrification Administration (NEA) on Thursday said the two months free power for lifeline consumers, or those who use 50 kilowatt hours or less every month, covers only customers serviced by electric cooperatives (ECs).
In a statement, the NEA said customers of private distribution utilities, like the Manila Electric Co. (Meralco), are not covered under the Pantawid Liwanag program.
The Pantawid Liwanag undertaking is a corporate social responsibility project led by the Philippine Rural Electric Cooperatives Association in cooperation with the National Association of General Managers of Electric Cooperatives, which seeks to aid member-consumer-owners of ECs who are categorized as lifeline consumers using electricity not exceeding 50 kilowatt hours (kWh) monthly.
Cabinet spokesman Karlo Nograles, concurrent spokesman of the Inter-agency Task Force on Emerging Infectious Diseases (IATF-EID), on Wednesday said power users who consume 50 kWh or less a month do not need to pay their power bills for the months of March and April.
The NEA said private distribution utilities are not involved in the Pantawid Liwanag project and are not mandated to offer the government’s subsidy. However, it said, private firms can offer a similar scheme for their respective customers.
The NEA said the two months free power consumption for lifeline users under the project covers only customers who are serviced by ECs.
Funding for the implementation of the project will depend on the financial capability of ECs whose definition of lifeline consumers vary, as determined by their respective managements, within the parameters set by regulators.
“There are ECs that have realigned budgets from some of their institutional activities, which were canceled due to the extended enhanced community quarantine (ECQ) to support this cause. Funds will not be drawn from their capital expenditures or operational expenses and it will not affect their financial obligations to their power suppliers and transmission providers,” NEA said.
Meanwhile, thinktank Infrawatch PH called for the suspension of value-added tax (VAT) and universal charges on power rates until the ECQ is lifted.
“The suspension of VAT and universal charges on electricity rates during the coronavirus crisis translates to around P200 in savings for the average household consuming 200 kWh. More important, this translates into a staggering P4.2 billion indirect economic aid to 21 million lower income households without the need for new loans or the sale of government assets,” Terry Ridon, the group’s convenor said.
He added that VAT on power continues to be a very contentious issue because systems losses, lifeline subsidies and franchise taxes are also levied with VAT.
“This is lazy, unsound policy-making inherited from previous administrations, as non-revenue activities are taxed. The President has the power to stop this, and now is the most perfect time,” Ridon said.
He said universal charges can also be suspended, particularly receivables of the Power Sector Assets and Liabilities Management Corp. (PSALM) for the National Power Corp.’s (Napocor) stranded debts and contract costs.
“Indirect economic aid to 21 million low income households from the suspension of PSALM universal charges amounts to P207 million. This is an intervention which the President can order at once, without question,” he added.
