Universal Charge
Administration of Universal Charge

Lighting the countryside: PSALM continues to significantly contribute to government efforts to provide a steady and reliable supply of electricity in the country's far-flung areas.

Communities in these areas get much-needed electric power through PSALM’s prudent management and disposal of the collections from the Universal Charge (UC) for Missionary Electrification (UC-ME).

A non-bypassable charge mandated under Section 34 of the EPIRA, the UC is imposed on electricity consumers for the following purposes:

  1. Missionary electrification;
  2. Payment for stranded debts and stranded contract costs;
  3. An environmental charge for watershed rehabilitation and management;
  4. Equalization of taxes and royalties applied to indigenous or renewable sources of energy vis-à-vis imported energy fuels; and
  5. A charge to account for all forms of cross-subsidies.

At present, only the UC-ME and the UC for Environment and Watershed Rehabilitation and Management (UC-EWRM) amounting to PhP0.0025 per kilowatt-hour are imposed on and are being collected from electricity consumers.

The UC is collected monthly by the National Grid Corporation of the Philippines and the distribution utilities based on the approval of the Energy Regulatory Commission (ERC). The collections are remitted to PSALM every 15th of the following month.

Universal Charge (UC) Administration

I. Universal Charge Remittances, Interests and Disbursements

  • As of 30 September 2019, remittances of collecting entities (CEs) to PSALM amounted to PhP182.634 billion, while interest earnings from deposits and placements of UC funds amounted to PhP0.253 billion. On the other hand, UC fund disbursement amounted to PhP181.426 billion. Below are the details of UC remittances, interests and disbursements

    Universal Charge Remittances, Interests and Disbursements
    As of 30 September 2019 (In PhP Billion)

    Particulars Remittances1 Interests Disbursements2 Balance
    Special Trust Funds: Missionary Electrification (ME) - NPC SPUG 96.189 0.045 96.222 0.012
    ME - Renewable Energy Developer Cash Incentive (REDCI) 0.697 0.012 0.292 0.417
    Environmental Charge (EC) 2.385 0.130 1.491 1.024
    Stranded Contract Cost (SCC) 78.510 0.064 78.569 0.005
    Stranded Debts 4.853 0.002 4.852 0.003
    Total 182.634 0.253 181.426 1.461

    1 Balance includes CEs’ remittances during the period 17-30 September 2019 which were deposited to the Main Trust Account (MTA) but will be transferred to each UC-STF on 19 October 2019, pursuant to Section 7 (c) of the ERC-approved Guidelines and Procedure Governing Remittances and Disbursement of the UC Guidelines
    2 Includes Disbursement to Oriental Mindoro Electric Cooperative, Inc. (ORMECO) in the total amount of PhP40,442,954.47, for the recovery of fuel costs chargeable against the UC-ME fund, pursuant to ERC Orders dated 16 June 2014 and 24 September 2014 covering ERC Case No. 2013-191RC

    The following disbursements/fund transfers were made from the respective UC Special Trust Fund (STF):

    1. UC-ME and EC

      • PhP96.222 billion and PhP1.491 billion were paid to NPC, chargeable against the UC-ME and EC fund, respectively, in accordance with the provisions of the EPIRA and the Energy Regulatory Commission (ERC) decisions/orders.
    2. UC-SCC

      • PhP78.569 billion was transferred from the UC-SCC STF account to PSALM’s UC-SCC Special Fund Account (SFA), following the PSALM Board-approved Guidelines and Procedures on Disbursement and Utilization of UC-SCC of NPC.
    3. REDCI

      • Cash incentive totaling PhP0.292 billion was paid to the following renewable energy (RE) developers, in accordance with the ERC-approved Rules to Govern the Availment and Disbursement of Cash Incentive to RE Developers Operating in Missionary Areas:
        1. Romblon Electric Cooperative, Inc. (ROMELCO) for the 900 kW Cantingas Mini Hydro Power Plant Corporation (CHPC);
        2. Sunwest Water and Electric Co. (SUWECO) for the 1.5 MW Hitoma 1 & 2.1 MW Solong Hydroelectric Power Plants; and
        3. ORMECO for the 2.1 MW Linao Cawayan Mini-Hydro Power Plant (LCMHPP) - Lower Cascade.

    Accounting for the inflows and outflows of the UC fund leaves it with a balance of about PHP1.461 billion as of 30 September 2019.

    Remittances for CY 2019

    For the period January to September 2019, PSALM received PhP14.436 billion in UC remittances, broken down as follows:

    UC Remittances to PSALM
    For the Period January to September 2019 (In PhP Billion)

    Month ME (NPC-SPUG) ME (REDCI) EC SCC SD Total
    January 1.052 0.012 0.017 0.948 0.193 2.222
    February 1.071 0.012 0.018 0.528 0.183 1.812
    March 0.933 0.010 0.015 0.131 0.160 1.249
    April 1.026 0.011 0.017 0.032 0.176 1.262
    May 1.023 0.011 0.017 0.018 0.201 1.270
    June 1.185 0.013 0.019 0.008 0.315 1.540
    Total 6.290 0.069 0.103 1.665 1.228 9.355

    *Differences from previous submission is due to rounding off

    Disbursements for January to September 2019

    For the period of January to September 2019, PSALM disbursed a total amount of PhP15.313 billion to UC beneficiaries as follows:

    UC Disbursements of PSALM
    For the Period January to September 2019 (In PhP Billion)

    Month ME (NPC-SPUG) ME (REDCI)/1 EC/2 SCC/3 SD Total
    January 1.051 - - - 0.179 1.230
    February 1.068 - - - 0.196 1.264
    March 0.945 - - - 0.162 1.107
    April 1.011 - - - 0.175 1.186
    May 1.010 - - - 0.198 1.208
    June 1.208 0.004 - - 0.319 1.531
    Total 6.293 0.004 - - 1.229 7.526

    1/No REDCI claim was received during the month
    2/Awaiting ERC Order/Decision on the disbursement of UC-EC
    3/Non-disbursement of UC-SCC starting January 2019 due to the full disbursement of the ERC-approved SCC for CYs 2007-2010 amounting to PhP8,547,230,000.00

    For the period of September 2019, PSALM disbursed PhP1.142 billion to NPC-SPUG to fund the missionary electrification functions, chargeable against the UC-ME fund. This is pursuant to the following ERC Decisions/Orders:

    Date Particulars ERC Case No.
    12 August 2013 ERC Decision on CY 2011 True-up Adjustments (PhP4.651 billion) 2012-085 RC
    10 October 2013 ERC Decision on CY 2010 True-up Adjustments (PhP2.566 billion) 2012-046 RC
    03 November 2013
    & 17 August 2015
    ERC Order on CY 2015 UC-ME Subsidy 2014-135 RC
    20 April 2015 ERC Order on CY 2014 UC-ME Subsidy (PhP2.763 billion) 2012-085 RC

    In accordance with the ERC decision dated 28 January 2013 under Case No. 2011-091 RC, the amount of PhP0.317 billion was transferred from the UC-SD to the UC-SD SFA for the period September 2019.

II. ERC - Approved UC Rates

  • The table below shows the ERC-approved UC rates being implemented as of 30 September 2019:

    Type PhP/kWh
    UC-ME 0.1561
    UC-EC 0.0025
    UC-SCC 0.1938
    UC-SD 0.0265
    Total 0.3789

    On 03 November 2014, the ERC issued an Order provisionally approving the instant petition filed by NPC on the proposed Subsidized Approved Generation Rate (SAGR) and the UC-ME for years 2015 to 2016. NPC was authorized to extend the implementation of the current CY 2014 UC-ME subsidy amounting to PhP0.1561/kWh from January 2015 to August 2015, broken down as follows:

    Particulars CY 2015
    UC-ME Subsidy 0.0454 0.1163
    Cash Incentive for RE Developers 0.0017 0.0017
    True-up Adjustment (2011) 0.0709 0.0000
    True-up Adjustment (2010) 0.0381 0.0381
    Total 0.1561 0.1561

    Further, the ERC issued an Order dated 17 August 2015 extending the provisional authority it granted under the ERC Order dated 03 November 2014, until revoked or made permanent by the ERC.