Consumer group to ERC: Block Meralco’s LNG pass-on costs


The Power for People Coalition (P4P) lambasted Meralco’s bid to pass on to consumers additional fuel costs from procuring expensive liquefied natural gas (LNG) despite the lack of clearance as flagged by the Energy Regulatory Commission (ERC). 
ERC’s confirmation comes after Meralco’s P0.5738 increase in its February billing without any validation that will justify its rate adjustment due to costly imported LNG procured from Meralco’s purchase agreement with First Gas Power Corporation (FGPC). 
“We are glad that the ERC is keeping tabs on reckless passing on of LNG costs. In the first place, consumers had no say over Meralco’s choice of buying expensive electricity from fossil fuels and it should be the one to bear its bad business decision,” said Gerry Arances, Convenor of Power for People Coalition. 
“The ERC needs to act on this matter urgently, and not just for upcoming rates from FirstGen – considering San Miguel Corporation’s South Premier Power Corporation has been using LNG since last year,” Arances added.
P4P also cautioned that allowing Meralco’s push to pass on LNG costs can open the floodgates for other distribution utilities to follow suit. 
“This is not just a problem for consumers in Meralco’s franchise areas. Meralco’s bid to pass on LNG fuel costs to consumers sets a worrying precedent that gives a go-signal for higher power rates in the country,” added Arances.
According to P4P, the delays in the validation of charges passed on to the consumers represent one in a myriad of problems with LNG contracts. 
“Meralco has a track record of piling additional costs onto consumers, who are not afforded clarity on where the numbers reflected in our electricity bills are coming from. The lack of transparency with LNG pricing – from fuel procurement contracts to actual electricity costing – has to stop. Issuing receipts is a standard business practice; neither distribution companies like Meralco nor generators like FirstGen and SMC are not exempted from this,” said Arances.

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