QuestionsQuestions (ERC)
The Guidelines were issued pursuant to Section 43(f) of R.A. 9136 (EPIRA), Rule 7 of its IRR, and Section 10 of R.A. 7832.
They apply to all Distribution Utilities (DUs), defined broadly to include electric cooperatives, private corporations, government-owned utilities, or existing LGUs with an exclusive franchise to operate distribution.
System Loss is the difference between kWh purchased and/or generated and kWh sold by a DU, expressed as a percentage of kWh purchased and/or generated.
It is the level of System Loss recoverable from customers as established by the ERC pursuant to Section 43(f) of the Act (R.A. 9136).
GR = AGC + OGA, where AGC is the adjusted generation cost computed automatically, and OGA refers to other generation rate adjustments subject to ERC verification rules.
AGC means Adjusted Generation Cost; it is automatically computed and does not require prior ERC verification and confirmation.
PPD is a 3% discount that DUs get from NPC for paying on time; in AGC, it is used as [(GCi + ... + GCn) - (PPD * 50%)].
OGA are adjustments such as under/over-recoveries in generation costs, recoveries from violation of contracts, and other pilferages, plus other adjustments deemed necessary by ERC; they are explicitly stated as not subject to any carrying charge.
The ERC shall automatically order the refund thereof through OGA, without prejudice to imposition of appropriate penalties.
DUs shall bill customers the Generation Rates effective on the tenth (10th) day of each month.
SLR = (GR * U) + (ATR * U).
U = (% System Loss / [1 - %System Loss]). The % System Loss used is the lower of actual System Loss and the System Loss Cap, plus actual company use or company use cap of 1%, whichever is lower.
ATR is computed as Transmission Costs per unbundling divided by the annualized sales (kWh) per unbundling, based on the most recent unbundling decision.
On the tenth (10th) day of each month using the newly calculated SLR.
On or before the twentieth (20th) day of each month, DUs must provide ERC all calculations related to Articles III and IV with supporting documents (e.g., invoices, sample bills, receipts, ERC Forms M-001 & M-002, and other relevant documents).
ERC verifies at least every six (6) months by comparing actual allowable costs versus actual revenues generated by GR and the portion of SL attributable to generation costs. If ERC fails to verify within six months from submission, the rates are deemed final and confirmed.
OGA other than those included in Article V, Section 2 must be verified and confirmed by ERC within forty-five (45) days from filing and only thereafter are they recoverable.
Upon effectivity of these Guidelines, GRAM shall no longer be applicable to Distribution Utilities.
They must file their final GRAM applications within sixty (60) days from effectivity, and the final filing includes the period from their last approved GRAM filing to the effectivity of these Guidelines for computing the final Deferred Accounting Adjustment (DAA).
The ERC may allow an exception from any provision of the Guidelines where good cause appears, the exception is found to be in the public interest, and it is not contrary to law or other rules.