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Power distributors required to detail pass-through charges

DISTRIBUTION utilities (DUs) are now required to submit a detailed breakdown of the components of their power bills following the revision of the rules on collecting pass-through charges, the Energy Regulatory Commission (ERC) said.

“We are looking forward to 2023 as the beginning of an era of greater transparency in electricity pricing. The new uniform reportorial requirement (URR) form will allow more information to be available and accessible,” ERC Chairperson and Chief Executive Officer Monalisa C. Dimalanta said in a statement.

The energy regulator’s Resolution No. 14 Series of 2022 calls for more transparent collection of pass-through charges by DUs. Pass-through charges are fees other than the distribution charge and the payment for the use of DUs’ facilities.

Pass-through charges are collected through the generation charge, which accounts for 60% of the consumer power bill. Other bill components are the transmission charge, or the fee for the use of transmission grid; other subsidies, and mandatory payments like the system loss charge and other charges as approved by the ERC.

Other pass-through charges include taxes, the feed-in tariff allowance (FIT-All), and the universal charge (UC).

Under the revised regulatory framework, DUs which includes both electric cooperatives (ECs) and private utilities (PUs) must provide a detailed breakdown of the power bill.

An ERC spokesperson also told reporters via Viber that “DUs shall submit to the Commission, every 31st day of May, an annual bank statement or statement of account, detailing the account transactions during the year.”

The revised rules also aim to “set a limit” which, when exceeded, will trigger an adjustment to correct under recovery of the pass-through charges. It will also streamline the process of rate reviews.

“This is the first step to the digital transformation we are undertaking in the Commission to speed up our processes and allow more predictability in regulation,” Ms. Dimalanta said. — Ashley Erika O. Jose

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