Sufficient and efficient power

Published by the Visayan Daily Star Publications, Inc.

NINFA R. LEONARDIA Editor-in-Chief & President

CARLA P. GOMEZ Editor GUILLERMO TEJIDA III Desk Editor PATRICK PANGILINAN Busines Editor NIDA A. BUENAFE Sports Editor RENE GENOVE Bureau Chief, Dumaguete MAJA P. DELY Advertising Coordinator

CARLOS ANTONIO L. LEONARDIA Administrative Officer

The local power cooperative in Negros Oriental has been under fire from the community because of the increase in power rates last year, and again this year.

The latest rate adjustment comes on the heels of the generation rate increase by one of NORECO 2’s power suppliers, Green Core Geothermal Inc., a subsidiary of the Energy Development Corporation.

The NORECO 2 acting general manager said the GCGI had increased its rates as stipulated in the contract signed by both parties on the escalation and de-escalation of pricing.

The average residential consumer will be charged P10.46 per kilowatt hour effective in the February 2012 billing, as opposed to the previous rate of P9.67 per kilowatt hour.

Early last year, the cooperative increased its power rate from P7.44/kwh in January to P8.90 kwh in June , due to power rate adjustments pegged on volatile coal prices. Again, in July, NORECO 2 increased its rates by P1.38 kwh.

Every time the local power cooperative increases its power rates, consumers always blame it and not the power supplier. It was only in October 2011, that the electric cooperative was granted a Certificate of Tax Exemption by the Bureau of Internal Revenue for its revenues on system loss, distribution, supply, metering, and lifeline subsidy, that are exempt from the value added tax. In effect, the exemption translates to a power reduction in the electric bill of the consumers.

NORECO 2 has explained that the adjustment of rates is not based on one supplier only, because power rates have multiple components, such as generation charge, which makes up 60 percent of the total rates and the remaining 40 percent composed of generation rates, transmission rates and universal charges.

GCGI imposes an adjustment in generation rates of 5 percent once a year using the consumer price index. Another power supplier, the coal-fired Korean Electric Power Company in Cebu, has increased rates by 10 percent for the same billing period.

We hope that the power rate hike is really the true cost of generating power and ensuring consumers the security and stability of our supply.

We also hope the cooperative will seek more proactive ways of ensuring that our power will be less costly, more sufficient, and efficient in the future.*