Press Release
March 13, 2013

Sen. Bongbong Marcos appeals to Napocor to defer power rate hike

Senator Ferdinand "Bongbong" R. Marcos, Jr. has appealed to the National Power Corporation (Napocor) to stay the imposition of power rate hikes at least for the summer months.

Earlier, the Energy Regulatory Commission (ERC) approved Napocor's petition for an additional universal charge (UC) of19.38 centavos per kilowatt-hour starting March 2013 to enable the state-owned power agency to settle its debts.

As a consequence, Manila Electric Company (Meralco) had announced an increase of 10.1 centavos per kilowatt-hour this month for their subscribers as the imposition of Napocor's UC more than offset the combined reduction in the power distributor's generation, transmission and system loss charges for March.

Marcos said Napocor should consider holding off the imposition of the increase, at least until the end of May because electric consumption of Filipino households is expected to increase in the peak of the summer season, which is normally from April to May.

If Napocor defers the power rate hike, Marcos said Meralco would have to do the same and allow households to enjoy the benefits of lower electricity bills because of the cuts in the generation, transmission and systems loss charges.

"Our households deserve at least a temporary respite from the pinch of higher power bills, particularly during summer when people use their electric fans and air-conditioners longer to get relief from the heat," Marcos said.

"This would also allow parents to save money, which they can use to augment their budget for food or for the enrollment of their children for the coming school year that would open in June," he added.

He noted that Filipino households are already groaning under the burden of high electricity rate in the country, which remains the second highest in Asia, based on a 2012 study of the International Energy Consultants.

The ERC-approved increase was meant to recover Napocor's stranded contract costs (SCC) or the premium that Napocor paid for in securing supply with independent power producers (IPPs), which the power agency absorbed and didn't pass on to consumers at the time they were incurred.

"But even such a temporary reprieve will mean a lot to our households and would not impact so much on the bid of Napocor to recover its SCC (stranded contract cost), which is spread anyway over a period of several years," Marcos stressed.

Under the Electric Power Industry Reform Act (Epira) of 2001, Napocor is allowed to recover its SCC through the universal charge.

Marcos reiterated his earlier call for the government to invest on power infrastructure not only to ensure adequate supply of electricity but also to drive down power rates.

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