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Bacolod City, Philippines Thursday, March 29, 2012
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CENECO files protest
vs. line rental rates


The Central Negros Electric Cooperative lodged a protest last week before the Philippine Electricity Market Corporation and the Energy Regulatory Commission involving the excessive line rental charges reflected in the March billing of their consumers due to a breakdown in the National Grid Corp. of the Philippines transmission line.

In his letter to PEMC president Merlinda Ocampo dated March 20, 2012, CENECO president Arnel Lapore said that, for the first time in history, CENECO was charged with line rental as high as 29 percent of its power cost.

Lapore said the line rental tripled and rose to P1.56 per kilowatt hour, which according the Wholesale Electricity Spot Market help desk, “There was congestion in our transmission line being managed by the NGCP on February 16, 2012 to February 23.”

The breakdown in the transmission line for the transfer of power from Cebu to Negros Occidental caused the WESM to automatically transmit power to CENECO from another source with higher rates than Kepco Salcon Power Corp. and Green Core where CENECO sources its power, he said.

Lapore said CENECO was not informed about the congestion in power transmission at the time it was happening. Such event triggered the tripling increase in the line rental charges and they became concerned because even ERC discourage increases reaching P0.50/kwh, he said.

Had CENECO been properly apprised, they could have reduced their bilateral nominations (or the order of supply in the bilateral contract they had signed up), accordingly and avoid unnecessary huge line rental charges, Lapore said. They could have also exercised load shedding measures depending on the decision of the CENECO Board, he said.

Lapore said the congestion in power transmission was triggered by NGCP and was beyond their control and CENECO was not even aware of it, he said. This also affected the rates of other electric cooperatives in Negros and other areas in Panay because of lack of coordination and information, he said.

Applying the “Cause Causation principle,” it is but proper that whichever caused the congestion that triggered the line rental increase should be the ones who will carry the burden of shouldering the ill effect of such action and not the electric cooperative victims, he added.

Lapore said NGCP should improve its system to minimize the congestion.

The rate increase is not part of the bilateral contract they have signed with any of the generators so they have lodged a formal protest with the ERC and PEMC on this and are waiting for their answer, he said.

They are demanding a refund of the payment of their consumers since CENECO has no option but to pass on the charges to its consumers, Lapore said. In the event, the amount will be refunded to CENECO, they will accordingly refund their consumers either by way of credit in their bills or in cash, he said.

“I hope the PEMC and ERC will address this as soon as possible,” he added.

Lapore said they are also calling on Congress to come up with procedures to prevent similar sudden power rate hikes from being imposed by WESM on consumers without prior notice, to ensure their protection.

He said he already asked Negros Occidental (4th District) Rep. Jeffrey Ferrer and probably other congressmen in Negros to help him by conducting a congressional inquiry where all the players in the industry have to participate and address this problem.

Other electric cooperatives have also lodged a protest on the matter, Lapore said. “We hope to be given a solution on this as early as possible,” he added.*CGS

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