The Energy Regulatory Commission (ERC) ordered Cotabato Light and Power Company (Cotabato Light) to refund P53.87 million to consumers following its review of the utility’s over- and under-recoveries for electricity costs covering 2013 to 2024.
In its Decision, the Commission approved with modification Cotabato Light’s four compliance filings and determined a net over-recovery of P54.37 million. After accounting for an outstanding balance of P508,747.24 from an earlier compliance period, the final amount refundable to consumers was set at P53.87 million.
The review covers over- and under-recoveries, or instances when a utility collects more or less than the amount ultimately determined to be recoverable under ERC-approved rules, to ensure that electricity charges are properly aligned with allowable costs.
In addition, the Commission noted that these differences may arise from variations between projected and actual costs or consumption, changes in sales, and the timing of rate adjustments, and do not necessarily indicate intentional overcharging.
The Commission said the Decision also marks a concrete step toward fulfilling its commitment to resolve the long-standing rate reset impasse.
“This Decision brings greater certainty to the regulatory process and ensures that confirmed over-recoveries are returned to consumers.”
“We are delivering on our commitment to resolve the long-standing rate reset impasse. This Decision brings greater certainty to the regulatory process and ensures that confirmed over-recoveries are returned to consumers,” ERC Chairperson and CEO Atty. Francis Saturnino Juan said.
The largest portion of the refund is the P40.77-million system loss over-recovery, followed by P17.64 million in generation over-recovery, P2.83 million in lifeline subsidy over-recovery, P2.70 million in transmission over-recovery, and P126,995.14 in real property tax over-recovery.
“This is fair, transparent, and accountable regulation in action.”
“This is fair, transparent, and accountable regulation in action,” Juan stressed.
Meanwhile, the ERC approved amounts for collection representing under-recoveries include P10.19 million in local franchise tax under-recovery and P12,989.21 in senior citizen subsidy under-recovery, subject to the rates and recovery periods specified in the Decision.
For residential consumers, the approved refunds and collections will be reflected in their electricity bills through specified rates and recovery periods over approximately 48 months.
The approved adjustments include a generation refund rate of P0.0179/kWh, transmission refund rate of P0.0010/kWh, system loss refund rate of P0.0402/kWh, lifeline subsidy refund rate of P0.0029/kWh for non-lifeline customers, and real property tax refund rate of P0.0001/kWh. These will be offset by the corresponding collection rates of P0.0104/kWh for local franchise tax and P0.0001/kWh for senior citizen subsidy, resulting in an aggregate indicative rate impact of P0.0516/kWh.
Likewise, the ERC denied P7.13 million in fuel cost recovery included in Cotabato Light’s third compliance filing, finding that the amount was not covered by the applicable automatic cost adjustment and true-up mechanisms and must instead be pursued through a separate application.
For implementation, Cotabato Light was directed to apply the approved adjustments beginning with the next billing cycle upon receipt of the Decision, reflect the applicable amounts in consumers’ bills, and submit a sworn compliance statement within 10 days from implementation. The utility must also submit monthly reports and supporting documents until the approved amounts are fully refunded or collected.
“Resolving long-standing regulatory matters means providing certainty to the industry while protecting consumers. We will continue to ensure that our Decisions are properly implemented and that consumers receive what is due to them,” Juan said.
