New ERC head urged to go hard on Meralco

07/20/2008

Even as it lauded her for stating such a promise, a consumer advocate group yesterday prodded new Energy Regulatory Commission (ERC) Chairman Zenaida Cruz-Ducut to make true her vow to swiftly address the many complaints of end-users of electricity against such companies such as the Lopez-controlled Manila Electric Co. (Meralco).

The National Association of Electricity Consumers for Reforms (Nasecore) said Ducut “stands at the threshold of making the ERC pro-consumer again after being subjugated for years by its past leaderships to serve the interests of Meralco.”

“We expect Chairman Ducut to immediately translate her words into action as the people, faced with the rising costs of basic commodities, services and transportation, can no longer stand being overcharged, too, by power distributors like Meralco,” Nasecore president Pete Ilagan said.

Ilagan said Ducut can start on the right track by moving for the cancellation of all ERC orders that disadvantage consumers, and by enforcing full compliance by Meralco on the provisions of its franchise and the Electric Power Industry Reform Act (Epira).

He said Ducut can begin by shepherding the ERC into ordering an immediate refund of the P21.7 billion meter and bill deposits of Meralco customers, plus the 4 percent differential increase in interest on these deposits, instead of giving Meralco five years with which to effect the refund.

“She must go hard on Meralco, which has been acting like a spoiled brat in need of a sound spanking. Meralco is a recidivist, always looking for ways to subvert the law and put one over consumers,” Ilagan said

He moreover averred that the ERC’s guidelines on the bills and meter deposit refund that was laid down by its former chairman, Rodolfo Albano Jr., was “a sellout” because it allowed Meralco “to drag its foot and hope that consumers would lose interest in following up their refunds.”

“Meralco took our deposits immediately, as a prerequisite to our being provided electric service. Thus, it is only right that our refund be immediate also,” Ilagan said.

Ilagan said Meralco has yet to refund in full the P30.2-billion overcharge which included its income tax it passed on to its consumers from 1994 to 2002, despite the Supreme Court (SC) order of the same having been issued five years ago.

“They are trying to circumvent (the SC refund order) by trying to make the consumers forget the P30.2 billion (Meralco had overcharged its customers) and by asking for several requirements that they are seeking before providing the refund. These tactics will be the same tactics that Meralco will adopt on the P21.7-billion refund (for its customers),” the Nasecore official said.

Nasecore has filed a multi-million syndicated estafa case against Meralco before the Department of Justice over the power firm’s use of P889 million of the said deposits.

Ducut was also urged by the group to decide in favor of the Filipino people on the controversial “systems loss” charges and the other pass-on fees collected by companies such as Meralco.

Ilagan said Ducut would “show a strong will and moral ascendancy to lead the ERC” if she moves for the cancellation of Meralco’s onerous power purchase agreements (PPAs) with its sister companies that are also owned by the Lopezes.

He said the PPAs allow the Lopez-owned independent power producers to sell expensive power to Meralco and to collect P20 billion a year in underserved “capacity fees” under the take-or-pay provisions of their “self-dealing” contracts.

“Chairman Ducut must put her foot down on these PPAs by declaring them illegal for being in violation of the Epira and the provisions of the franchise given power distributors,” Ilagan asserted.

He added the ERC must also stop the practice of Meralco of passing on to consumers the cost of its own electrical consumption at its offices, amounting to half a billion pesos each year.

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