ERC’s Dimalanta warns some co-ops may be affected by delays

DELAYS in the Energy Regulatory Commission’s (ERC) proceedings may affect power rates for some electric cooperatives (ECs) pending the appointment of an acting chair to lead the decision-making on pending power supply contracts, suspended chairperson Monalisa C. Dimalanta said.

Ten days after her suspension, Ms. Dimalanta said in a briefing on Thursday that around 23 ECs have at least 50% exposure to the Wholesale Electricity Spot Market (WESM), which is vulnerable to price volatility.

The WESM is the trading floor that such ECs turn to if their contracted power supply proves inadequate. Spot market commodities are typically more expensive than markets where delivery is arranged far in advance, as with the Power Supply Agreements (PSAs) used by the power industry.

She had given instructions to the commission’s technical staff to check whether the ECs with high exposure have pending PSAs for approval “so we could bump up the approval to limit or avoid WESM exposure of the ECs.”

“If they continue to be exposed, there is risk that their rates will be higher,” she said.

In an order dated Aug. 27, the Ombudsman suspended Ms. Dimalanta for six months without pay over a complaint filed by the National Association of Electricity Consumers for Reforms, Inc. (Nasecore).

The allegations involve grave misconduct, grave abuse of authority, and conduct prejudicial to public service.

Nasecore claims that the ERC “failed to recalculate the rate of Meralco (Manila Electric Co.) that protects the interest of the public and runs counter to the objective of the ERC’s Performance Based Regulation.”

Ms. Dimalanta said she was expecting to receive a resolution from the Ombudsman on her motion for reconsideration within the week, or five days from filing.

She said that the grounds for her suspension are moot as the commission has decided on the matter raised in the complaint against her.

She said that the ERC decided to dismiss the rate application and “consider the fifth regulatory period (5RP) as a lapsed period.”

This means that Meralco’s rate will remain unchanged until the end of the years covered by the rate reset.

“On Aug. 21, the Commission voted, 3-2, and I was part of the two that dissented, along with Commissioner Maceda. Our dissent vote was that there needs to be a proper reset for the fifth regulatory period, which is the 2022 to 2026 period of Meralco,” Dimalanta said.

“My point was it is the job of the regulator to do the reset. There hasn’t been a reset in 10 years, so why should we let go of our job to reset for a period that is yet to lapse,” she added.

Asked to comment, Meralco said it has yet to receive the copy of the decision.

It added however that “based on ERC Rules, which require that the rate application of distribution utilities must be based on the forecast of their annual revenue requirements in the next four years, the 5^th RP Application of Meralco should have been decided by ERC before the start of the 5RP on July 1, 2022,” the power distributor said. — Sheldeen Joy Talavera