Meralco: ‘Unbundling’ to benefit small users

Customers of electricity distribution giant Manila Electric Company (Meralco) will now see in detail what they are paying for and where their money goes when they get their electric bills this month.

Meralco said it started itemizing or "unbundling" its charges yesterday as ordered by the Energy Regulatory Commission (ERC).

"In the unbundled Meralco rates, customers will clearly see what they are paying for as the new rates unbundled or itemize the bill according to cost and function, in general, generation, transmission, distribution, metering, supply and universal charges," Meralco spokesman Elpi Cuna said in a statement.

Although the commission granted Meralco an unbundled rate increase of 8.65 centavos per kilowatt-hour (kwh), ERC Chairman Manuel Sanchez said small end-users would mainly benefit from the unbundling.

Meralco said customers would no longer have to pay the so-called purchased power adjustment, which it used to collect in behalf of National Power Corp. and paid to its independent power producers.

Cuna added the unbundled rates do not include customer billings for income tax. "This is in accordance with the recent Supreme Court decision which declared that Meralco cannot recover income taxes from its customers’ charges," he said.

"The customers that would benefit the most from the lifeline discounts are those consuming within 50 kwh, who will get a 50 percent discount in their monthly bills with the unbundling," said Ivanna de la Peña, Meralco utility economics head.

"Some 591,000 customers or 15 percent of Meralco’s total number of customers already fall in this category," she said.

Sanchez said customers using 50 kwh and below will pay nearly P100 less and those using 200 kwh and below will have an estimated P87 cut in their billings.

Rebates to customers ordered by the Supreme Court would similarly be reflected in future Meralco billings, Sanchez said.

Last April 9, the tribunal upheld a Nov. 15, 2002 ruling by its five-member third division that Meralco’s income taxes are not reasonable costs that may be recovered from consumers.

It ordered a refund of Meralco customers who it said were overbilled between February 1994 and February 1998. The refund could cost as much as P29 billion.

Meralco, which is 24 percent owned by Philippine government agencies and 16 percent by the Lopez family, covers Metro Manila and surrounding areas. It has 3.5 million customers.

De la Peña said the itemized rates also show how much goes to Meralco and how much Meralco collects in behalf of other entities, called "pass-through charges."