BAGUIO CITY – The Benguet Electric Cooperative (BENECO) disclosed that the effect of the skyrocketing prices of coal in the world market to the power rates being charged by private power distribution utilities and electric cooperatives to their respective consumers will be realized in April or May this year.
BENECO general manager Engr. Melchor S. Licoben stated that the electric cooperative’s power supplier, the Sual-based TEAM Energy Corporation, already sent word to the different power distribution utilities and electric cooperatives sourcing their power from the coal-fired power plant that it could no longer absorb the significant increase in coal prices in the world market that reached more than $420 per metric ton that is why whatever computed increase in the generation charge will be passed on to the said utilities.
He pointed out that the generation charge is one of the so-called pass through charges reflected in the monthly power bills of consumers where the same is merely collected by the utilities and the electric cooperatives and subsequently passed on to their consumers without any additional charges.
The sudden increase in coal prices in the world market started early last year where the minimum threshold of $170 per metric ton started to significantly increase over the past several months until it reached the level of $300 to $400 per metric ton.
While BENECO was able to strike a temporary agreement with the power supplier that there should be a stable generation charge that will be billed to the electric cooperative even if there will be slight increases, Licoben explained that the recent increase in coal prices could no longer be absorbed by the generator that is why it will be passing on to the distribution utilities and electric cooperatives whatever will be the computed increase in power rates in the coming months.
According to him, the adjustment in power rates being charged by BENECO from the member-consumer-owners is already beyond the control of the electric cooperative and that the same is dictated by outside factors that is why consumers should be ready to deal with the situation once there will be significant increases in power rates within the next several months.
BENECO still remains to be one of the electric cooperatives that charges the lowest power rates from its consumers despite the increases in pass through charges that are beyond the control of the distribution utilities.
Licoben appealed to the consumers to understand the current predicament of the private power distribution utilities and electric cooperatives on the situation caused by the sudden increase in power rates triggered by the unprecedented increase in coal prices in the world market.
Under the pertinent provisions of Republic Act (RA) 9136 or the Electric Power Industry Reform Act (EPIRA), the so-called pass through charges such as the generation, transmission charges, the value added tax among others are beyond the control of the private power distribution utilities and electric cooperatives while the distribution, supply and metering are the ones that are being controlled by the said utilities and cooperatives.
BENECO did not increase its distribution, supply and metering charges since 2012 even if the same is already due because of the impact that was inflicted by the ongoing Coronavirus Disease 2019 (COVID-19) pandemic to the economic activities and sources of livelihood of the people.
