Philippines OKs PHP1.0354/KWh Rate Hike For Napocor -2-
Monday, April 25, 2005
MANILA (Dow Jones)--The Philippines' Energy Regulatory Commission said Friday that it has allowed National Power Corp. (NAP.YY) to raise the average rate that the state utility charges for electricity by PHP1.0354 per kilowatt-hour.
The increase, which will be final, should help the ailing state utility improve its finances, ERC Chairman Rodolfo Albano told a media briefing.
In September last year, the commission approved a provisional rate hike of PHP0.9798/kWh - way short of the PHP1.8700/kWh increase sought by Napocor to put it back in the black.
Friday's announcement added PHP0.0556/kWh to the September adjustment.
Napocor is an albatross for the government, which has guaranteed the utility's debts and issued bonds on its behalf for years because the utility can't issue debt at an affordable price on its own.
In December, the government absorbed PHP200 billion ($3.67 billion) of the state utility's PHP500 billion debt.
"Napocor sorely failed to prove their case for an increase of PHP1.87/kWh," Albano said.
The ERC disallowed some of Napocor's claims in its rate petition, such as for depreciation charges, and operation and maintenance, he said.
However, the ERC approved Napocor's request to recover costs already incurred due to an increase fuel prices and cost of purchased power, as well as foreign exchange losses, Albano said.
These two adjustments will be collected for a period that won't exceed 21 months, according to Napocor's application.
The incurred cost of fuel and power purchased amount to an increase of PHP0.3048/kWh for Luzon in northern Philippines, PHP0.4734/kWh for Visayas region in central Philippines and PHP0.4767/kWh for Mindanao in the south.
For foreign exchange losses, there will be an increase of PHP0.1821/kWh in Luzon, but for Visayas and Mindanao, there will be a reduction of PHP0.0967/kWh and PHP0.0772/kWh, respectively.
The rate adjustments will take effect April 26, and will be reflected in the billing statement of residential and other users in June, Albano said.
The rate adjustment will help in the privatization of Napocor.
posted by philpower @ 1:04 PM,
