Meralco: Electricity rates ‘fair, reasonable’

MANILA – The Manila Electric Co. (Meralco) on Thursday reiterated that the rates it imposes on its customers undergo a rigorous approval process before they are implemented to ensure they are “fair and reasonable.”

Meralco issued the statement after Sta. Rosa City Rep. Danilo Ramon Fernandez urged the electric utility to refund some P200 billion in overcharges to its consumers.

In a hearing of the House Committee on Legislative Franchises on Wednesday, Fernandez, who is calling for the breakup of Meralco’s franchise into three smaller franchises, said the utility’s 7.7 million customers were overcharged and must receive refunds of from P26,000 to P30,000 each.

“Meralco is the one controlling the prices of electricity because it is the biggest seller and biggest buyer (of electricity in the country),” Fernandez said.

In a statement sent to The Manila Times, the utility said that as a highly regulated entity, its rates undergo a “rigorous review and approval process.”

“All rates that are in the bill have prior lawful and regulatory approval, as [Meralco] cannot unilaterally set its own rates,” it said.

It said there are regular reviews of its rates that result in some adjustments, like in the refunds directed by the Energy Regulatory Commission, to which Meralco has complied.

The setting of the weighted average cost of capital (WACC), which Fernandez alleges is at 14.97 percent and has been unchanged since 2015, is up to the ERC, Meralco said.

“Meralco did not have a determined WACC since July 2015 because there was no rate reset during the lapsed regulatory period,” it said.