LKI Press the 2021-028 on rollback of UCME, July 28, 2021

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LKI Press Statement 2021-028

July 28, 2021

Consumer group urges ERC to rollback universal charges for missionary electrification

Consumer advocacy group Laban Konsyumer Inc. (LKI) and its President Atty. Vic Dimagiba recently urged in a filing via a Memoranda with the   Energy Regulatory Commission (ERC) to roll back universal charges for missionary electrification, based on  meritorious arguments in support of the pleading.

Laban Konsyumer said “The National Power Corporation did not submit the Formal Offer of Evidence required by the ERC Rules thus any and all   evidence submitted in support the instant application should be excluded and rejected. There  are also  five ( 5 ) other  similar applications from calendar years 2016, 2017, 2018, 2019 and 2020  that remain pending decision by the Commission, thus under litis pendentia, the instant application should be dismissed. The current universal charges are sufficient for the NPC to perform their mandate under the EPIRA.The economic data supports a rollback instead of an increase in universal charges.”

Dimagiba highlighted “The  records show  that NPC has  filed the 4th extension to submit the Formal of Evidence or FOE  and   obviously the filing of the 4th extension were  intended solely to delay  the proceedings and resolution  of the  case committed by no less than NPC  itself.”

Dimagiba expounded “For the failure to submit the FOE, the Commission shall not consider any evidence which has not been formally offered. (ERC Revised Rules of Practice and Procedure, Rule 18, Section 11).”

Citing a Supreme Court decision in Pasag et al vs. Parocha et al, G.R. No. 155483, April 27, 2007, the 2nd Divison of the Supreme Court held that the rule on formal of evidence is not a trivial matter. Failure to file the FOE within a considerable period of time shall be deemed a waiver to submit and any evidence that has not been offered shall be excluded and rejected.

Suppletorily, Section 34 of   the Rules of Court provides that it shall consider no evidence that has not been offered.

Laban Konsyumer “asked the Hearing Officer how would the Commission proceed with the prior pending applications in the light of the pending current application? Are these prior pending applications   prejudicial issues that should be resolved before the instant application is decided by the Commission.”

On cross examination, the NPC disclosed the prior pending UCME applications of the National Power Corporation were as follows:

Case No. 2016-134            Php 0.1248

Case No. 2017-054            Php 0.1530

Case No. 2018-076             Php 0.1948

Case No. 2019-069            Php 0.1920

Case No. 2020-011            Php 0.2055

Dimagiba said “The current UCME of Php 0.1561 was issued pursuant to a provisional authority in 2015. With the above pending UCME applications, the Commission task is to determine the least cost to the consumers. That is too daunting considering the five (5) years backlogs of supporting data that the Commission shall evaluate to arrive at the least cost to the consumers.”

 The NPC witness testified that based on the 2015 census, the applicant has served 1,188,733 HHs and 365,304 HHs unserved for total Philippines.   NPC achieved this performance with the 2015 provisional authority of Php 0.1561 pkwh of universal charges, which   could support the argument that NPC don’t need any justification to increase the UCME.

In addition ,  the NPC witness disclosed that NPC used 95 % of diesel fed  plants in it’s missionary electrification . The witness failed to answer questions that world crude oil prices went down since 2015 by about 23% from an average of USD 52 for Brent crude to USD  40 as of July 2020 (US Energy Administration). For Dubai crude, in 2015 the average amount is USD 50.94 to USD 41.21 in July 2020 or a reduction of 19.1%. (Opec. Org)

Even while the Peso depreciated by 10.7 % over the USD for the same period ( the universal charges for missionary electrification should be ten percent (10%) lower this 2021 versus 2015.

Dimagiba moved that ERC dismissed any increases in universal charges for missionary electrification  but albeit order a rollback and apropos consider moot and academic all pending prior applications in ERC.

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