SINGAPORE — Energy Regulatory Commission (ERC) Chairman and CEO Francis Saturnino Juan on Wednesday said that regulators were looking at other options to help mitigate the possible increase in electricity rates as the peso hitting P64 against the dollar would cause generation charges to spike.
“So, we’re still on what else we can do to help mitigate the increase in generation charges brought about by depreciation of the Philippine peso,” Juan said in a sideline media interview at the Singapore International Energy Week event.
He explained that the generation charge will be greatly affected because of the way generation prices are structured and how the foreign exchange can influence how much fuel generation companies will be able to buy to run their power plants.
Meanwhile, in terms of the distribution charges, Juan said they will not immediately be impacted by the peso depreciation, because their rates have to be scheduled or set after a rate filing.
Juan also noted that looking for other options has been difficult, as they have done other initiatives to help lessen the bill shocks to consumers brought about by the recent oil-related developments in the Middle East.
“We’ve done a lot of work in order to prevent bill shocks from happening to consumers,” Juan said.
“We have issued a clarification on the secondary price cap, and directed its application on a regional basis so that it will kick in for other island groups even when prices in Luzon are low,” Juan added.
He continued that the commission has also addressed one of the main drivers of high bills, which is the reserve market and temporarily suspended it.
“We are already doing plenty, but it feels like it is still currently not enough,” Juan said.
