Press Release
December 8, 2013


Sen. Serge Osmeña today urged Malacañang to utilize a small portion of the Malampaya fund to subsidize the estimated P10 billion in additional generation costs that households in Metro Manila and neighboring areas are expected to pay over two months to cover the P4.15 per kilowatt-hour (kWh) increase in the generation charge of the Manila Electric Co. (Meralco).

Osmeña, who is the Chairman of the Senate Committee on Energy and co-chairman of the Joint Congressional Power Commission (JCPC), said President Aquino could tap the more than P130 billion balance in Malampaya funds to cover the amount.

"The Malampaya Fund has gotten very fat. It is time that it is used to ease the burden of power consumers," Osmeña said.

Osmeña has for years proposed that government lower the royalty collected on the Malampaya gas to lower power rates.

"It is better to spend the Malampaya Fund to subsidize power rate hikes rather than lose it to PDAF scams," Osmeña added, noting reports that hundreds of millions of pesos in Malampaya collections have reportedly been diverted to unscrupulous and even non-existent Non-Government Organizations (NGOs) supposedly with the connivance of government officials and lawmakers.

He also said: "If the law establishing the Fund (Presidential Decree No. 910) has to be amended, we can do that in 2 weeks. All the President has to do is to certify the bill for prioritization."

Meralco has announced a total increase of P4.15/kWh (inclusive of transmission charge, VAT, local franchise tax and system loss) in its generation charge this December following the shutdown of the Malampaya natural gas plant from November 11-December 10. The Malampaya facility fuels three power plants in Luzon, which use the natural gas supplied by the fields in offshore Palawan. It has a combined output of 2,700 megawatts, the bulk of which is under contract with Meralco.

The increase would jack up Meralco's generation charge to over P9/kWh in December from P5.66/kWh in November. With the projected generation charge adjustment, a Meralco customer with a monthly average use of 200 kilowatt-hours currently paying P2,000 per month, will now pay P2,830 per month, or a monthly increase of P830 in his electricity bill.

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