THE Energy Regulatory Commission (ERC) has ordered the Philippine Electricity Market Corp. (PEMC) to hold off on the collection of the net settlement surplus (NSS) adjustment from electric distribution utilities in the May billing.
In its statement on Thursday, the energy regulator said its order to the electricity market operator is meant to temper power rates in Metro Manila next month.
The ERC said it issued the directive after PEMC confirmed that there was a “huge discrepancy” between the Wholesale Electricity Spot Market’s preliminary statement and the final statement for May 2021.
An NSS adjustment takes place when there is a surplus or deficit after all market transactions are accounted for. The adjustment reflects price differences between generators and customer locations arising from losses and congestion in the market’s locational marginal pricing scheme.
The ERC said the NSS adjustment would have resulted in an additional charge of around 20 centavos per kilowatt-hour to customers of Manila Electric Co. (Meralco) by July 2021.
“We have ordered PEMC to defer the collection of the NSS adjustment until the investigation on the said incident has been completed. If PEMC’s collection is not suspended… (there) will be an additional charge of around P0.20 per kWh to Meralco customers,” ERC Chairperson and Chief Executive Officer Agnes VST Devanadera said.
She said that the deferment of NSS adjustment collection will prevent and shield power consumers from experiencing a bill shock next month.
“Some of these consumers were also affected by the rotational brownouts which happened in May 2021, so it is quite unfair for them to be charged with an additional collection due to the NSS adjustment. We will get to the bottom of this and make sure that any erring market participant will get penalized as soon as it is established,” Ms. Devanadera said.
The NSS is distributed to market trading participants who are eligible to receive a portion of the surplus or deficit in line with the ERC-approved pricing mechanism. — Angelica Y. Yang