Power rate hike due to generation cost

By Delmar O. Carino

BAGUIO CITY -- The changes in generation cost remains to be the driver for the increase or decrease of electricity bills issued monthly to member consumers.
    Melchor Licoben, Beneco’s OIC general manager, said the uptick in the generation charge on a monthly basis is legally allowed even without approval by the Energy Regulatory Commission (ERC) compared to the other components of the electric bill.
    Beneco will charge its more than 140,000 consumers P9.4007 per kwh this August, up from P8.5989 per kwh in July. The increase was caused by the generation cost that had to be adjusted following the increase in the demand of electricity that pushed fuel cost up, coal in particular.
    Licoben said the generation sector is by law recognized as a deregulated sector of the power industry pursuant  to the Electric Power Industry Reform Act (EPIRA). “This means that there is no need for ERC approval of the generation cost since it is governed by the contract between the power supplier and the distribution utility,” he said.
    The contract includes terms and variations based on foreign exchange rate and fuel costs whose price changes are indexed in a pre-agreed formula, Licoben said.
    Beneco, just like other ECs, will have to pass such cost and its adjustments to the consumers as the cost is deemed a “pass through” charge, or one that Beneco as a distribution utility, will have to collect as a collecting agent for the power supplier.
    The change in fuel cost adversely affected Beneco’s power supply pact with Team Energy that runs the coal fired power plant in Sual, Pangasinan where Beneco’s power supply comes from.
    The Beneco and Team contract provides that the generation cost from Jan. to June will be P3.85 per kwh and from July to Dec., P3.80 per kwh.
    The increased demand for power pushed coal prices high this year, thus breaching the coal bandwith between Beneco and Team.
    “The generation cost will then be rebased, meaning the formula for its computation will be adjusted to absorb the index prices,” Licoben said, adding that the generation cost eats up more than 50% of the power bill.
    The distribution, supply and metering (DSM) charges, and the reinvestment fund for sustainable capital expenditure (RFSC) in the bill, however, have remained at the average of P.099 and P.2178 per kwh, respectively.
    The RFSC and DSM are Beneco’s “pass on” charges to the consumers or the charges that it collects and retains for its  operations and capital outlays.
    Licoben said that compared to the generation charge, the RFSC and DMS charges cannot be changed at the will of the electric cooperative since the distribution sector is a regulated sector of the power industry where any change is such bill components must be approved by the ERC.
    “The volatility of global coal prices will definitely affect the generation charge of distribution utilities. Our power supply agreement with Team was very attractive as it gave Beneco the lowest power cost for the last three years,” Licoben said.

However, Licoben said that the revival of economic activities following the pandemic this year caused a surge in electricity demand that effectively pushed coal prices upward.

Team was compelled to ask Beneco’s consumers to shoulder the increase in generation cost, he said.

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DOE grants P6 million to study Antamok for BLISST trash site

BAGUIO CITY –Energy Secretary Alfonso Cusi has sourced P6 million from the energy department needed by the Philippine National Oil Company–Renewables Corporation (PNOC-RC) for completion of ongoing feasibility study on utilization of a 29-hectare property of Benguet Corp. for the local government’s proposed integrated solid waste disposal facility to address solid waste disposal problems of the Baguio-La Trinidad-Itogon-Sablan-Tuba-Tublay (BLISTT) area.

PNOC-RC officials led by its president John Arenas told outgoing Baguio mayor Domogan latest developments on the ongoing feasibility study on the  property ceded by the country’s oldest mining company to Baguio to ascertain the suitable area for the proposed integrated solid waste disposal facility.

Domogan said the proposed integrated solid waste disposal facility, including an engineered sanitary landfill, a waste-to-energy plant, a centralized materials recovery facility, an anaerobic digester, a toxic and medical waste treatment plant, a special waste treatment plant and the operation of the Environmental Recycling System (ERS), will help stop the hauling of the city’s residual waste to the engineered sanitary landfill in Urdaneta City, Pangasinan.

Earlier, BC ceded to the local government a total of 29.11 hectares from its existing properties in Antamok, Itogon which could be used for the establishment of an integrated solid waste disposal facility for a period of 25 years without any payment in return.

PNOC-RC previously entered into an agreement with the local government to pursue the conduct of a feasibility study for the proposed put up of the integrated solid waste disposal facility within the ceded property to ascertain which portion of the property will be suitable for the said purpose.

The PNOC-RC also entered into an agreement with the Benguet Electric Coop. which will purchase the renewable energy produced by the planned waste-to energy plant. -- Dexter A. See

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El Niño damage P4 billion in Isabela

BAYOMBONG, Nueva Vizcaya– The dry spell continued to wreak havoc in this agricultural region with Isabela, the country’s leading corn and rice producer, now losing some P4 billion in crop damage.

According to reports, Isabela’s corn crops, which account for nearly 20 percent of the country’s total corn output per cropping season, suffered the bulk of damage of at least P2 billion or equivalent to some 70 percent of its expected corn yield this coming harvest.

Likewise, damage to palay already reached more than P1.4 billion or equivalent to 104 metric tons. The rest of crop damages have been accounted from fishery, livestock and other high-value crops.

Dr. Danilo Tumamao, Isabela agriculture officer, said the damaged palay represents more than 20.39 percent of the province’s anticipated palay output for the first semester of the year.

Isabela, along with Cagayan Valley’s other mainland provinces – Cagayan, Nueva Vizcaya and Quirino – produces at least 25 percent of the country’s total rice and corn production per year.

These provinces have already been placed under calamity state, practically putting the entire Cagayan Valley, so far the only region in the country under such dire state as a result of the prolonged El Niño weather phenomenon.

The El Niño damages reported in Cagayan Valley account for some 50 percent of the more than P8 billion worth of damages noted so far nationwide by the Department of Agriculture, indicating that the region is the worst-hit area throughout the country. -- CL

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Tabuk is pilot area for local power firm

TABUK CITY, Kalinga – The Cordillera Regional Development Council recently identified this city as pilot area where a local power corporation owned by the stakeholders in the affected communities and the whole province will own a power generation facility to satisfy their power requirements and earn profit from the sale of excess electricity.

This developed after provincial officials headed by Gov. Floydelia Diasen, Tabuk City officials led by Vice-Mayor Ranier Sarol and the RDC-Car under the stewardship of Juan Ngalob, regional director of the National Economic Development Authority (NEDA) in the Cordillera conducted an exposure and educational trip in Bohol to study the set up of a local power corporation for their place.

Under the concept of the local power corporation here, the mini-hydro power plant will be co-owned by the provincial, municipal and barangay governments as well as the indigenous communities to ensure social acceptability and sufficient power supply, especially for still unenergized areas in the province.

According to Ngalob, the importance of including the indigenous communities in the partnership is to help sustain the source of water which are the watersheds, thus, if they are active involved in the operation of the power corporation, they will be encouraged to spearhead the preservation and protection of the environment in their respective places.

The RDC-has earmarked at least P1 million from the autonomy fund to capacitate the local governments to be financially independent since fiscal autonomy is a prelude to regional autonomy, an advocacy which is now being undertaken by the region’s policy-making body to spur economic development in the Cordillera in the future. -- Dexter A. See

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