EXPECT lower electricity rates.

The Energy Regulatory Commission provisionally approved this month the translation of the P1.6012/kWh Year 2012 Maximum Average Price (MAP) of the Manila Electric Company.

That 2012 MAP is P0.0452/kWh lower than its 2011 average distribution rate of P1.6464/kWh.  The reduced distribution rates will be reflected in the October 2011 billing of Meralco.

On June 6, the ERC issued a decision for ERC Case No. 2010-069 RC regarding the Final Rate Determination for Meralco which prescribed its 2012 MAP for the third regulatory period. 

In the Final Determination, Meralco was required to translate into distribution rates the Maximum Average Price for the Regulatory Year 2012 under the Performance Based Regulation methodology.  In the Final Determination, the ERC also adopted a more stringent Performance Incentive Scheme which mandated Meralco to strictly observe the approved performance indicators and provided it the appropriate incentives to improve its services to electricity end-users.

The rate translation applied for by Meralco, upon initial evaluation by the ERC, was found to be in conformity with the Final Determination and with the requirements of the Rules in Setting Distribution Wheeling Rates (RDWR).  Meralco was found to be adhering to the uniform filing requirements of the ERC.  The functionalization and allocation factors were well-structured and supported by detailed analyses. 

“The benefit of Performance Based Regulation (PBR) is now becoming more evident with these lowered distribution rates of Meralco and the corresponding improved quality service levels.  Note that the same decreasing rate pattern was likewise experienced in the case of the transmission rates approved for the National Grid Corporation of the Philippines (NGCP)”, ERC Chairperson and CEO Zenaida G. Cruz-Ducut remarked.