Dismissed UC petitions filed prior to Murang Kuryente passage

30 Jun 2020

The Power Sector Assets and Liabilities Management Corp. (Psalm) clarified that petitions on imposing the universal charge (UC) on electricity end-users were filed prior to the enactment of a law that aims to reduce power rates.

Last week, the ERC announced it dismissed eight petitions for the true up adjustment of National Power Corp.’s (Napocor) stranded contract costs (SCC) and stranded debts portions of the UC, covering calendar years 2007 to 2018.

ERC Chairman and Chief Executive Officer Agnes Devanadera had said consumers would no longer be paying an additional P0.2536 per kilowatt hour in electricity rates after the dismissal of Psalm’s applications.

The petitions, according to the ERC, were deemed “moot and academic” following the enactment of Republic Act 11371 or the “Murang Kuryente Act.” But in a statement on Saturday, Psalm said none of the UC petitions at issue were lodged prior to the passage of the law.

Psalm also stressed it is yet to officially receive all the ERC orders on the dismissal of the above-mentioned petitions and only two orders on a 2018 UC SCC petition and a 2018 UC SD petition, both dated May 28, were transmitted by the regulator to the state-led corporation last June 23.

In a text message, Psalm President and Chief Executive Officer Irene Joy Garcia said it is “prudent to wait and just comment on them after we have read and studied the wordings of the decisions.”

“ERC’s dismissal is not because there are no valid SCC and SD but rather, because the Murang Kuryente Act was already passed into law before the ERC was able to act on Psalm’s petitions,” it said.

“Unfortunately, despite the timely filing of the said petitions and the evidence presented by Psalm, the ERC did not resolve the petitions right away and as a consequence, the petitions were thus overtaken by the passage of the Murang Kuryente Act on August 8, 2019 and its implementing rules and regulations (IRR) on May 5, 2020,” it added.

Under the law, the government’s P208-billion share in net proceeds from the Malampaya natural gas project in offshore Palawan province would be tapped to settle Napocor’s financial obligations assumed by Psalm.
As a result, Psalm shall not file with the ERC any new petition for these charges and debts until the entire amount is exhausted and no other allocations are made by Congress.

Psalm is mandated by RA 9136, or the “Electric Power Industry Reform Act of 2001,” to sell the remaining assets and settle the financial obligations of Napocor.
The state-run firm’s financial obligation fell to P404.28 billion as of May 14 from P422.01 billion in the first quarter of 2020.


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