========================================================
Due to generation cost
TACLOBAN CITY — Eight of Eastern Visayas’ 11 distribution utilities (DUs) and electric cooperatives were among the 20 power distributors with the highest residential electricity rates in the country in July, according to an Aug. 6 report by the Institute for Climate and Sustainable Cities (ICSC).
The eight were Biliran Electric Cooperative (Bileco) at P18.34 per kilowatt-hour (kWh), Northern Samar Electric Cooperative (Norsamelco) at P16.49/kWh, Southern Leyte II Electric Cooperative (Soleco) at P15.71/kWh, Leyte Electric Cooperative III (Leyeco 3) at P15.70/kWh, Eastern Samar Electric Cooperative (Esamelco) at P15.09/kWh, Don Orestes Romualdez Electric Cooperative (Dorelco) at P14.95/kWh, Leyeco 4 at P14.88/kWh and Samar Electric Cooperative(Samelco 2) at P14.51/kWh.
Eastern Visayas has 11 DUs and electric cooperatives serving the region’s six provinces and more than 1.1 million consumers.
The ICSC said generation charges accounted for 57% of the average residential electricity rate in July, or P7.28/kWh, making it the largest component of consumers’ electricity bills. The charge rose by 10% from June.
Generation charges are essentially the cost of the electricity purchased by distribution utilities from power producers to supply their customers. These costs are affected by fuel prices, wholesale electricity market conditions and the prices agreed upon in power supply contracts.
According to the ICSC, this means electricity rates remain vulnerable to fluctuations in global fuel prices, particularly because many power plants still rely on imported fossil fuels such as coal and liquefied natural gas.
“Electricity bills will remain vulnerable as long as the country remains heavily dependent on imported fossil fuels,” said ICSC Energy Transition Adviser Alberto Dalusung III, who called for a more diversified energy mix anchored on indigenous renewable energy.
The ICSC said the impact of dependence on imported fuels was particularly evident during the 2022 global energy crisis, when surging international coal and liquefied natural gas prices drove up generation charges.
The findings come as Congress examines another component of electricity bills—system loss charges—which Northern Samar 2nd District Rep. Edwin Ongchuan, vice chairperson of the House Committee on Energy, wants the Energy Regulatory Commission (ERC) to immediately reduce.
At an Aug. 5 House energy committee hearing, Ongchuan asked whether the ERC could lower allowable system loss caps under its existing authority while Congress works on legislation to eventually abolish the charges.
The ERC said it has authority under Section 43(f) of the Electric Power Industry Reform Act (EPIRA) to adjust system loss caps based on technical considerations, but completely removing the charges may require legislative action.
System loss refers to electricity lost between its delivery into a distribution system and the amount ultimately billed to consumers. It includes technical losses from power lines and equipment and nontechnical losses such as electricity pilferage and illegal connections.
Under EPIRA, DUs may recover allowable system losses from consumers within ERC-prescribed limits. Losses beyond the caps cannot be passed on to consumers.
The issue gained national attention after President Ferdinand Marcos Jr. called for the abolition of system loss charges in his fifth State of the Nation Address on July 27, saying consumers should not pay for losses they did not cause.
JOEY A. GABIETA
