[PRESS RELEASE]
The National Association of Electricity Consumers for Reforms, Inc. (NASECORE) has filed a complaint for violation of the anti-graft law before the Office of the Ombudsman against officials of the Energy Regulatory Commission (ERC) for failing to enact rules that would govern applications for rate increase by public utilities such as the Manila Electric Company (MERALCO).
The complaint alleges that the ERC deliberately refused to set and promulgate rules that are mandatory to set the electricity rates of the Manila Electric Company (MERALCO). Said refusal to promulgate said rules required of them by law amounts to dereliction of duty that has caused undue injury to the MERALCO consumers.
The ERC is the government regulator of the electricity industry and is mandated by law to approve rates charged by electric cooperatives as well as their use of funds collected from consumers.
NASECORE President Pete Ilagan said “The Commission’s inaction in allowing a Regulatory Period to lapse without setting the rates is an act of gross inexcusable negligence and a case of giving MERALCO undue advantages and benefit by way of over-recoveries to the prejudice of the consuming public.”
“The Commission’s continued inaction on these cases amounts to a dereliction of its fundamental duty, as a regulatory agency, to fix reasonable rates for distribution utilities only to the extent as “to allow the recovery of just and reasonable costs and a reasonable return on rate base (RORB) to enable the entity to operate viably.
We regret to say that the current high rates of electricity can only be attributed to the needless inaction and gross neglect of duty by the present and past commissioners of the ERC”, Ilagan said.
“This inaction of the ERC has allowed MERALCO, for the first time in its history, if we are not mistaken, to voluntarily offer a refund to the consumers in the amount of PHP 13,885,845,931.00, without being asked.” But that is only its own calculation. The real amount owed to the consumers could be much more, if only the ERC came up with the rules for rate adjustments. “This can only mean that MERALCO has been over-collecting from its consumers due to the absence of rules that the ERC is mandated to issue and which should have been used to determine whether MERALCO has been collecting the correct rates” Ilagan added.