ERC dismisses PSALM’s bid to collect more stranded costs

The Energy Regulatory Commission dismissed several petitions filed by Power Sector Assets and Liabilities Management Corp. to collect stranded contract costs and stranded debts under the universal charge billed by state-run National Power Corp. to consumers.

“The ERC’s dismissal of the PSALM’s petitions embodies the intent of the Murang Kuryente Act which is to lower the cost of electricity being charged to end-users. With the dismissal of the subject PSALM petitions, electricity consumers will no longer be charged with an additional P0.2536 per kilowatt-hour which is supposed to be added to their electricity bills had the Murang Kuryente Act not been passed into law,” said ERC chairperson Agnes Devanadera in a statement.

The cases were deemed moot and academic after the enactment and effectivity of the Murang Kuryente Act or Republic Act No. 11371 where no new universal charges for SCC and SD would be collected from all electricity end-users. 

The regulator dismissed eight petitions filed by PSALM from 2007 until 2018 for the true-up adjustment of the NPC’s SD and SCC portions of the universal charge.

The Murang Kuryente Act mandated the use of P208 billion of the Malampaya fund for the payment of the NPC’s SCC and SD which was assumed by PSALM. 

It also provides that PSALM should not file with the ERC any new petition for UC SCC and SD until the allocated P208 billion amount was exhausted and no other allocations were made by Congress.

PSALM is mandated under the Electric Power Industry Act of 2001 to manage the assets and liabilities of NPC.

“Had the ERC been hasty in approving those eight PSALM petitions, consumers may have suffered another rate increase,” Devanadera said.

She assured electricity consumers that the ERC was carefully studying the impact of each and every petition filed that would affect electricity bill.  

“The consuming public is the most vulnerable stakeholder in the electric power industry and we, at the ERC, are duty-bound to protect them from unnecessary and unjustified increase in electricity rates,” Devanadera said.