SC ruling upholding ERC jurisdiction over WESM beneficial to consumers – Meralco

A Supreme Court ruling affirming the Energy Regulatory Commission’s authority over the Wholesale Electricity Spot Market (WESM) has prevented further increases to the generation charge being passed on to consumers.

In a statement, Meralco said it welcomes the High court’s decision which upheld ERC’s jurisdiction to set prices in the WESM, the country’s trading floor for electricity, as this effectively confirmed the power utility giant’s position that the prices for the 3rd and 4th months of WESM should be adjusted.

WESM prices surged as much as P4,903/MWh and P7,218/MWh in the third and fourth month.

The PEMC Market Surveillance Committee concluded that certain market participants behaved anti-competitively and abused market power. Eventually, the ERC set the WESM settlement prices.

The amount involved was almost P9 billion, translating to what would have been an additional imposition of P6/kWh in generation charges.

“This resolution is a welcome relief to the consumers, especially at this time of pandemic, as there would be no additional burden to consumers. If the WESM prices were not adjusted, this would have translated to an increase in the generation charge of its consumers of about 90 centavos and P2.05 per kilowatt hour for the supply months of September and October, 2006, respectively which we will be passed on to consumers,” Meralco said.

“We would like to assure our customers that Meralco will continue to look for possible ways to lower electricity costs while guarding against unreasonable impositions and charges, most especially during these challenging times in the midst of global pandemic,” the power company added.

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