Meralco seeks approval to forego charges on use of radio frequency for smart meters

MANILA, Philippines - Power distribution giant Manila Electric Co. (Meralco) is seeking the approval of the Office of the President (OP) and the Department of Finance (DOF) to forego charges on the use of radio frequency for smart meters.

An exemption from the fees will lessen the burden of more than five million Meralco customers in their shift to smart meters.

Meralco is asking the national government to waive the spectrum user fee (SUF) charged by the National Telecommunications Commission (NTC), said Marthyn S. Cuan, vice-president and Corporate Information Officer of Meralco.

Asked what is holding the government from granting the exemption, Cuan said: “It is more of the DOF and OP, the revenues to be collected.”

Under NTC rules, users of the spectrum or radio communication technology will have to pay P500 per annum for each outdoor radio station operated by private persons/entities with a maximum data rate of 11 megabit per second (MBPS). In excess of the 11 MBPS, users will have to pay P1,000 every year.

This year, Meralco is set to pilot test the smart grid technology, which means “computerizing” the electric utility grid. It includes adding two-way digital communication technology and computer processing from power plants all the way to electricity consumers.

Each device on the network can be provided with matching sensors to gather data from power meters, voltage sensors, fault detectors, plus two-way digital communication between the device in the field and the utility’s network operations center.

Complete rollout of the project is scheduled next year, Cuan said.

Cuan said Meralco is looking at a fee of P3,000 for one time registration of the smart meters.

Cuan said the company has sought for the recommendation of the Department of Energy and the Energy Regulatory Commission for the fee exemption.

If not granted, consumers will then pay P500 to P1,000 per year for the use of smart meters. In December, Meralco and the Private Electric Power Operators Association sought for the NTC’s approval to exclude smart meters from the SUF.

Meralco added 40,000 new customers in the first quarter, bringing the total to a record 5.07 million as of end-March.

Cuan said Meralco wants to capture data real time using the smart and prepaid meters.

“The reason why we are also installing new sets of meters as well is that the customers can have more knowledge of their consumption,” Cuan said.

Smart grid is a multi-technology innovation that builds intelligence into the electricity network such that distribution utilities like Meralco get near real-time feedback on network conditions, consequently minimizing outages and significantly improving restoration and complaints handling, Meralco said.

Cuan said Meralco is looking at renting or buying the 915 to 918 megahertz 2g frequency for the smart meters. The frequency is currently not assigned to any telecommunications firm.

Meralco, which is indirectly controlled by Hong Kong-based First Pacific Co. Ltd. and partly owned by San Miguel Corp., is the country’s largest power distributor.

Its core net income, which strips out currency and derivatives-related items, rose by five percent to P3.42 billion in the first quarter from a year ago.