Energy Regulatory Commission okays revised deal between Angeles utilities

MANILA, Philippines – The Energy Regulatory Commission (ERC), the country’s power sector watchdog, has allowed Angeles Electric Corp. to revise its power supply agreement with Angeles Power Inc. (API).

AEC and API filed the joint application for an amended supply agreement with the ERC.

The companies said they have to take into account into their new agreement the changes in fuel prices.

“The current bunker prices are about three times the base fuel cost when the electricity purchase agreement was drafted almost three years ago,” the companies said.

API , in its application, told the ERC that it also needs to adjust its rates based on these new factors.

The company said the adjustment is necessary to be able to deliver better serives to its customers.

In the approved deal, ERC gave AEC and API approval to peg their base rate at P247.34 per kilowatt-months to cover capacity or capital recovery fees.

The ERC also approved a 33-centavo per kilowatt-hour charge for operations and maintenance fees.

The commission also allowed the company to use energy or fuel fees that will be based on a consumption rate of 0.26 liters per kilowatt-hour.

The regulator also made permanent an amended supply deal inked by both parties.

AEC is the electric utility that distributes electricity in Angeles City in Pampanga province.

On the other hand, API is an independent power producer that runs a 30-megawatt diesel power plant located at the Angeles Park Special Economic Zone in Calibutbut, Bacolor in the same province.

AEC procures 40 percent of its total power requirements of 375 million kwh this year from API and the rest from state-owned National Power Corp.

AEC currently has a long term deal with API that runs from Jan. 1, 2007 to Dec. 31, 2016.

In 2006, the ERC had approved the contract but it also gave both parties an option to renegotiate their supply deal should the privatization of state-owned power assets affect the rates of the power firm.