ERC SAYS MERALCO’S AMI WILL RAISE COSTS BY P0.2309 PER KWH, EVALUATION ONGOING
The Energy Regulatory Commission (ERC) is currently evaluating the cost implications of Manila Electric Company’s (MERALCO) pending Advanced Metering Infrastructure (AMI) application to minimize its impact to consumers.
“The Commission is conducting further study pertinent to these smart meters for the AMI considering that our initial calculations disclosed that an average rate adjustment of PhP0.2309/kWh will be added to the customers’ electric bill if the smart meters will be shared by all MERALCO customers, while an average rate adjustment of PhP0. 3972/kWh if charged only to MERALCO bulk customers”, ERC Chairperson and CEO Agnes VST Devanadera explained.
MERALCO filed its application for approval of its AMI project with the ERC in March 2017 in accordance with the “Rules to Govern the Implementation of Advanced Metering Infrastructure (AMI) by Distribution Utilities and other ERC-Authorized Entities”. In connection with its AMI application, MERALCO included the smart meters and other devices and systems necessary to implement its AMI project in its application for Capital Expenditures in April 2017.
The subject Rules, which was promulgated in May 2016, requires ERC approval prior to the implementation of any AMI project. Furthermore, it provides that the cost of all meters, devices, hardware, software and processes necessary to implement the approved AMI project, whether offering basic and/or supplemental services, may be passed on to consumers subject to the applicable ERC rules and regulations on capital and operational expenditure approvals.
The implementation of the AMI will promote demand side management and energy efficiency as it provides tools or services that empower consumers to manage their consumption. The AMI is also expected to enhance the operational efficiency of the distribution utility and the reliability of its network. The AMI will support Retail Competition and Open Access, once in place.
“We welcome these state-of-the-art technologies that will help consumers manage their electricity consumption. However, we must see to it that the installation of these Advanced Metering Infrastructure (AMI) should not adversely affect the consumers in terms of paying higher electricity rates. We must protect the welfare and interests of our electricity consumers considering that our rates is one of the highest in the region and the government’s thrust is to make our electricity rates competitive and reasonable”, ERC Chair Devanadera concluded.
Manila Electric Co.’s prepaid retail electricity service hit a snag amid the delay in the issuance of the advance integrated metering rules, an executive said.
Meralco so far installed 105,000 to 108,000 smart meters, but was hoping to roll out three million smart meters by 2023.
“We intend to finish up the 40,000 this year, but the filings we’ve given the last three years have not been decided on, totaling to about a million meters,” said Meralco senior vice president and head of customer retail services and corporate communication Al Panlilio.
Panlilio said the first step should be the issuance of the AMI business rules and approval of Meralco’s pending filings on the smart meters with the Energy Regulatory Commission.
“We are waiting for that. Those are AMI rules, not only for prepaid but also postpaid smart meters,” he said.
He said Meralco also uses the same smart meters for postpaid customers who want to shift to prepaid.
He said postpaid customers often receive “bill shock”, thus they have the option to shift to prepaid once the rules are approved.
“With smart meters, you will see your daily consumption and we are also developing an app,” Panlilio said.
He said the company received approval to roll out only 140,000 smart meters.
“We have 6.5 million customers…By 2023 we will have three million under the plan we submitted to ERC,” he said.
Meralco is offering the prepaid service under Kuryente Load.
Meralco’s prepaid electricity allows customers to monitor electricity consumption through mobile phone SMS notifications and manage electricity expenses with budget-friendly load denominations for as low as P100.
Kuryente Load runs on the latest “smart” meters which allow Meralco to detect outages instantly, allowing for faster power restoration in times of need.
Photo from BusinessWorld