Power rates of the Benguet electric Cooperative (BENECO) could possibly increase by more than P1.50 per kilowatt-hour in the next billing cycle primarily because of pass-on charges from generation and energy-related State companies which are not within the control of the electric cooperative.
BENECO Assistant General Manager Engr. Melchor S. Licoben disclosed that the projected power rate increase will include the agreed settlement between the electric cooperative and its power supplier, TEAM Energy Corporation, on the computed balance from the actual billed and agreed generation charge that could amount to more than P1.20/kwh and the rates being billed by the Private Sector Assets and Liabilities Management (PSALM) Corporation.
However, Licoben described the agreement that will be stricken by BENECO with TEAM Energy as a ‘good deal’ because it resulted to more than P1.5 billion less than the supposed billed amount that was heavily dictated by the skyrocketing prices of coal in the world market.
From the P2.3 billion generation charge billed by TEAM Energy to BENECO fir its power supply when coal prices started to skyrocket at the height of the COVID-19 pandemic, he claimed that the electric cooperative was able to negotiate that the same be significantly reduced to around P684 million which will be the one that will be passed on to the consumers once the agreement shall be stricken by the contracting parties.
The BENECO official pointed out that during the pandemic, the generation charge increased twice, first from the previous P3.95/kwh to P4.95/kwh and from P4.95/kwh to P5.73/kwh which was way below the P7 to P8/kwh being billed by the supplier to the electric cooperative.
Licoben asserted that BENECO had been questioning the billing of the generation company for the power that it supplied BENECO because of the earlier agreements amidst the skyrocketing coal prices in the world market as coal is still an important fuel for the Sual coal-fired power plant where most of BENECO’s power comes from.
On the other hand, Licoben said that another contributory to the projected power rate adjustment is the payment that the electric cooperative is supposed to pay to PSALM for the use of its assets that will translate to some P0.32/kwh depending on what will be the latest computations that will be reached by the contracting parties.
The assistant general manager revealed that among the short, medium and long-term solutions being implemented by the electric cooperative to contain the impact of the projected rate adjustment is the conduct of competitive bidding for the energy supply once its contract with TEAM Energy Corporation will expire in March next year.
Further, BENECO is also working out its registration with the Wholesale Electricity Spot market WESM) as a possible customer although the power rates are variable but it will just serve as part of the solution to the impending expiration of the contract.
Licoben emphasized that the electric cooperative is pursuing the put up of more sources of renewable energy that will be in addition to its 3.2-megawatt Man-asok mini hydro power plant to sustain its efforts to charge cheap power supply to the increasing number of consumers.
