Parties, entities, and key definitions
- “Universal Charge” means the charge, if any, imposed for recovery of Stranded Debts of NPC, Stranded Contract Costs of NPC, Stranded Contract Costs of Eligible Contracts of Distribution Utilities, and other purposes authorized in Section 34 of EPIRA.
- “End-user” means any Person or entity requiring the supply and delivery of electricity for its own use.
- “Collecting Entities” are (1) TRANSCO or its Buyer or Concessionaire, and (2) Distribution Utilities or Suppliers (for Contestable Markets) authorized to collect from End-Users on a monthly basis.
- “Contestable Market” refers to electricity End-users who have a choice of a Supplier, as may be determined by the ERC under EPIRA.
- “Distribution Utility” means any electric cooperative, private corporation, government owned and/or controlled utility, or existing local government unit with an exclusive franchise to operate a Distribution System under its franchise and EPIRA.
- “Self-Generation Facility” means a power generation facility owned and constructed by an End-user for its own consumption or internal use, excluding generation facilities for households, clinics, hospitals, and other medical facilities.
- “Missionary Electrification” means providing basic electricity service in Unviable Areas with the ultimate aim of bringing operations in those areas to viability levels.
- “Main Trust Account” means the bank account established by PSALM exclusively for receiving remittances of Universal Charge collections from Collecting Entities.
- “Special Trust Fund” means a trust fund established by PSALM for each intended purpose of the Universal Charge and its corresponding Beneficiary/Beneficiaries.
- Beneficiaries are entities eligible or authorized by the ERC to avail of the Universal Charge under EPIRA and the IRR.
- “Buyer or Concessionaire” refers to a qualified party awarded the sale agreement or Concession Contract for transmission assets; references to TRANSCO apply to its Concessionaire upon assumption of TRANSCO’s responsibilities.
- “Guidelines” means the Guidelines and Procedures Governing the Remittances and Disbursements of the Universal Charge promulgated by PSALM in consultation with the DOF and approved by the ERC.
- “Market Operator” refers to either the Autonomous Group Market Operator (AGMO) or the Independent Market Operator (IMO), including the assumption of functions, assets, and liabilities as provided in EPIRA’s Section 30.
- “DOF” refers to the government agency created pursuant to Executive Order No. 127, as amended.
Coverage and who must pay
- Universal Charge is collected from Electricity End-users and related electricity users defined under the rules through monthly billing and remittance processes.
- Universal Charge is imposed on End-Users purchasing electricity from Distribution Utilities, including residential, commercial, and industrial consumers, including government and/or public buildings, irrigation systems, and special lighting systems.
- Universal Charge is imposed on End-Users who purchase electricity from a Supplier in a Contestable Market except that such End-Users are excluded from the Distribution Utility category and are instead covered through Suppliers in Contestable Markets.
- Universal Charge applies to End-Users not connected to a distribution system, including government agencies and institutions and industrial enterprises.
- Universal Charge applies to locators, developers, operators, and facilities operating in Economic Zones, provided they are not performing the distribution function.
- Universal Charge applies to persons using Self-Generation facilities.
- Universal Charge applies to generation facilities used for start up, maintenance, or plant shutdown.
- The ERC is authorized to later identify other entities covered under the intent of EPIRA.
Collecting entities and monthly collection
- Universal Charge is collected by (a) Distribution Utilities, (b) Suppliers in Contestable Markets, and (c) TRANSCO (or its Concessionaire) from End-Users and Self-Generation Entities not connected to a Distribution Utility, and not being served by a Supplier.
- Distribution Utilities and Suppliers collect Universal Charge on a monthly basis from End-Users within their distribution coverage and Contestable Market arrangements.
- TRANSCO collects Universal Charge on a monthly basis from End-Users and Self-Generation Entities not connected to a Distribution Utility and not served by a Supplier.
- Collecting Entities collect Universal Charge in a fiduciary capacity and remit it in accordance with the Guidelines.
Billing items and remittance mechanics
- Each Distribution Utility and Supplier must determine monthly electricity sales in kilowatt-hours (kWh) to each End-User.
- If sales are un-metered, the Distribution Utility or Supplier must determine the amount based on wattage or connected load.
- If a billing End-User receives more than one electric power bill in a month, the Universal Charge collection rules apply to each bill and to the kWh covered by each bill.
- Each electric power bill issued by a Distribution Utility or Supplier must separately identify Universal Charge components showing the amounts per kilowatt-hour and the total payable for the billing period for each item:
- Universal Charge for Stranded Debt and Stranded Contract Cost of NPC
- Universal Charge for Stranded Contract Cost of Distribution Utilities
- Universal Charge for Missionary Electrification
- Universal Charge for Equalization of Taxes and Royalties
- Universal Charge for rehabilitation and maintenance of watershed areas
- Universal Charge for the removal of cross-subsidies
- The amount billed as Universal Charge must be paid in full by End-Users and must not be included in the computation of Franchise Tax and must not be offset by any discounts granted by the Distribution Utility or Supplier.
- Universal Charge collected by each Distribution Utility or Supplier must be deposited by the Collecting Entity to the Main Trust Account of PSALM with a bank that PSALM specifies.
- PSALM must create a separate trust-held account for each of the six (6) intended purposes of the Universal Charge for any future claims of Beneficiaries.
- TRANSCO must bill End-Users and Self-Generation Entities not connected to a Distribution Utility and not served by a Supplier and collect on a monthly basis.
- TRANSCO must determine monthly electricity usage for such End-users as follows:
- For End-Users directly connected to TRANSCO facilities, use actual meter reading.
- For Self-Generation Facilities once Universal Charge applies, provide TRANSCO access to meters; if no meter exists, the Self-Generation Facility must provide TRANSCO information under oath on its usage for the monthly billing period.
- TRANSCO must exert its best effort to identify End-users with self-generation facilities and submit its report on them to the ERC.
- TRANSCO’s electric power bill to covered End-Users and Self-Generation Entities must contain the Universal Charge component information required under Section 3.01(b).
- Payments for Universal Charge must be paid in full and must not be included in the computation of discounts granted by TRANSCO.
- TRANSCO must collect payment for Universal Charge on the same day payments for own accounts are due.
- All Universal Charge amounts collected by TRANSCO must be deposited to the Main Trust Account of PSALM with a bank that PSALM specifies, with separate trust accounts for each of the six (6) intended purposes.
Deferment for self-generation facilities
- Self-Generation Facilities—whether new, existing, or under construction—are not covered by Universal Charge imposition for a period of four (4) years from its imposition.
- Deferment applies only if the Self-Generation Facility registers with the ERC and PSALM.
Enforcement for late, partial, or non-payment
- If an End-User or Self-Generating Entity makes late, partial, or non-payment of the Universal Charge (except as covered by the four-year deferment), the concerned Collecting Entity may enforce payment using its powers and authority.
- Enforcement includes the power to disconnect electric service.
Information reporting and verification duties
- Each Collecting Entity must furnish PSALM with relevant monthly information on billing and collection so PSALM can monitor proper remittance to protect all End-Users.
- The Market Operator must submit information under the monthly framework to allow PSALM to verify the information provided by Collecting Entities.
- Each Collecting Entity must submit to PSALM (by electronic mail or facsimile transmission) the required monthly statements and information on or before the fifteenth (15th) day of the succeeding month, or no later than the date the Collecting Entity remits Universal Charge collections to the Main Trust Account.
- For electronic mail or facsimile submissions, the Collecting Entity must deliver the original copy to PSALM within ten (10) working days from remittance.
- Distribution Utilities and Suppliers must submit monthly to PSALM:
- A certified statement of total actual billings, separately identifying each Universal Charge component and including total actual sales in kWh
- A certified statement of total actual collections, separately identifying each Universal Charge component
- The Chief Financial Officer (or equivalent or duly authorized representative) must sign the certified statements for billing and collections
- A Distribution Utility (or similar ERC-authorized Collecting Entity collecting for its own Stranded Contract Cost) must separately identify:
- In billing statements: (1) the amount it is authorized to avail in the relevant month and (2) the amount billed to End-Users for that purpose in the relevant month
- In collection statements: the amounts collected from End-Users for this purpose and withheld from remittance to the Main Trust Account
- TRANSCO must submit to PSALM the documents enumerated for Distribution Utilities and Suppliers in respect of its invoices and collections from End-Users directly connected to transmission, provided such End-Users are not served by any Supplier.
- TRANSCO must submit to PSALM all relevant documents or information on invoices and collections from Self-Generation Entities.
- The Market Operator must submit to PSALM not later than the fifteenth (15th) day of each month a summary of actual meter readings in kWh for the immediately preceding calendar month, separately identifying each metering point and the corresponding Distribution Utility, Supplier, or End-User connected to the transmission system.
Fiduciary accounting and oversight
- Collecting Entities must retain Universal Charge collections in a fiduciary capacity and remit according to the Guidelines.
- Collecting Entities must maintain separate books of accounts for each Universal Charge component described in Section 3.01(b).
- Separate books of accounts must be made available to the ERC and PSALM during business hours upon two (2) days prior written notice.
- PSALM must submit to the DOF and ERC on a quarterly basis a report on Universal Charge remittances by Collecting Entities and disbursements from the STF.
Administrative sanctions for violations
- The ERC monitors and ensures implementation of the Universal Charge collection rules.
- The ERC may impose appropriate fines and penalties for violations or non-compliance under Section 5 of the Guidelines governing administrative sanctions in the form of fines and penalties pursuant to Section 46 of RA 9136.
Separability and effectivity
- If any provision or section of the rules is declared unconstitutional or contrary to law, the remaining parts remain in full force and effect.
- The rules take effect on the fifteenth (15th) day following publication in a newspaper of general circulation in the country.
- The rules were adopted on 5 Dec. 2003 by the ERC Commissioners.