ERC okays increase in CEBECO III rates

The Energy Regulatory Commission has approved the power supply agreement of Cebu Electric Cooperative III and Toledo Power Corporation and allowed the electric cooperative to pass on the dispatch fee to its customers.

Under the agreement, CEBECO III will be getting power from Mirant-TPC instead of the National Power Corporation with a guaranteed dispatchable capacity of 8 megawatts.

But under ERC conditions, CEBECO III and TPC are only allowed to use the approved time of use rates of the NPC as basis of computation of the generation rates of TPC to the electric cooperative.

The commission also specified that half of the three percent dispatch fee should be passed on as rate reduction to CEBECO III's customers. But the cooperative is still required to submit report to ERC in case it availed of the three percent dispatch fee and how it is passed on to the electricity users.

The term of contract is good for 12 years, which covers the period from Feb. 26, 2003 to Feb. 26, 2015.

The contract further said that the minimum energy off-take is 2,920,000 kilowatt hour per billing month which accounts for residential KWH consumption.

But in its decision, ERC said that TPC effective generation rate would be 6.5 percent lower than the commission's approved generation rates for the Visayas grid.

With this, the commission said that the approval would be advantageous to customers of CEBECO III because its rates would be lower than that of the NPC and will ensure the quality, reliability and security of electricity supply within its franchise area.

On Sept. 17, 2004, CEBECO III and TPC filed a petition before the ERC seeking for the approval/review of their power supply agreement.

CEBECO III serves the towns at the southwestern side of Cebu province. - Wenna A. Berondo