By: Peter G. Jimenea

“THE LOCAL franchise taxes levied by the local governments and remitted by the power company are legitimate expenses which the law allows to be recovered from customers as these charges are considered a pass-through cost.”

This is what Energy Regulatory Commission (ERC) Executive Director Francis Saturnino Juan said about the rate increases of power companies approved by ERC officials as in the case of Meralco.

A pass-through cost charged to customers for repair and rehabilitation of the transmission lines and other expenses of the power companies is giving us an impression that stockholders investments are immune from losses.

The compounding problem is the reaction of Presidential spokesperson Abigail Valle about the snowballing complaint of consumers regarding ERC’s approval of the petition for the continuing rate increases by power companies.

She said Malacañang can do nothing to stop the ERC as it is an “independent body” not under sanction by the Department of Energy (DoE). Palace can only monitor but as to rate increase, it is beyond their control. I’m sure you know what that means!

Malacañang has been muttering its administration must gird for war against corruption, na “walang mahirap kung walang corrupt.” But the president, thus far, has shown they can do nothing, hinting a grim possibility of helping the poor in this case.

The National Grid Corporation of the Philippines (NGCP) had been asking ERC a P0.82 rate increase to recoup the P80.2M it allegedly spent for the rehabilitation, repair and restoration of transmission line facilities damaged by typhoon Bayang and Juan in 2010.

Meralco also wants to recover its losses from maintenance and repair which should be charged to customers in the amount of P2.3B. Other companies have also their respective petition filed with the ERC on rates increase.

In fact, Panay Energy Development Corporation (PEDC) that managed the coal-fired power plant owned by the Global Business Corporation (GBC) in Barangay Ingore, La paz, Iloilo City has already effectively charged the P692M losses to customers.

Surprisingly, the palace spokesperson, perhaps, hoping to ease the tension, said they will monitor prices and provide this information to update the public. But prices on basic goods, fuel and medicines only, as to power rate increase none!

Mind you, but every power company has its own term for this racket. The PEDC has the “Under Recovery Program” for the P692M chargeable to customers. And know what? the ERC called it? Tax recovery adjustment cost.

Adjustment cost? The amount was due to the PEDC’s testing of the plant and other business related costs.

It pains me to imagine that the ERC office has been overrun by thieves. But the trend speaks of the same tone. What’s more, with absolute freedom to decide on their own, the ERC officials had made Pres. Aquino look like a kid in school uniform!

This is not what we think ERC business is all about. But its approval of PEDC’s under-recovery is a concept of justice at odds with due process – to punish us consumers for its wrong committed.  And oh my God, while ERC officials are heartless, Pres. Aquino is….. see the title!