Oct 1, 2020

Phase out of power rate subsidy in Palawan opposed

Board member Ryan Maminta said that removing the UCME grant, which keeps power rates low, will be oppressive to the residents who are still trying to get back on their feet because of the coronavirus disease pandemic.

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The provincial board has expressed opposition to the Department of Energy’s (DOE) directive to end its universal charge for missionary electrification (UCME) subsidy for off-grid areas like Palawan.

In a resolution it passed on Tuesday, the provincial board warned that ending the UCME subsidy as stated in Department Circular No. 2019-01-0001 entitled “Prescribing the omnibus guidelines on enhancing off-grid power development and operation” will have grave negative impacts on the operations of electric cooperatives in rural locations where there is lack of grid access.

Board member Ryan Maminta said that removing the UCME grant, which keeps power rates low, will be oppressive to the residents who are still trying to get back on their feet because of the coronavirus disease pandemic.

“This provision is oppressive, discriminatory and against the principles of social equity which the government is supposed to provide to all its citizens, in this particular case, to all the electric consumers, both in the main grid and in off-grid areas,” Maminta said.

Maminta said that if the present P0.1544 per kilowatt UCME will be removed, generation charges will increase from P5.6406 to P10.1429 per kilowatt to as high as more than P37.0160 per kilowatt in Small Power Utilities Group (SPUG) areas and isolated grids which will be a burden for the member-consumer-owners (MCOs).

Maminta also said that the removal of the subsidy from the UCME would also increase the generation cost in SPUG areas and isolated grids.

“For the government to implement the public service, we do not have the opportunity to access the cheaper cost of power in the main grid. [It] should continue the provision of the UCME subsidy to mitigate the impact of the expensive and higher cost of the power generation,” Maminta added.

He also urged the three House representatives and the local government units (LGUs) in Palawan to express opposition to the UCME removal by approving resolutions that oppose it.

Recently, Palawan Electric Cooperative (PALECO) also said that the removal of UCME will bring negative effects to its MCOs.

PALECO chair Jeffrey Tan-Endriga said electric cooperatives expressed their opposition to no avail to the Department of Energy’ (DOE) Circular No. 2019-01-0001 entitled “Prescribing the Omnibus Guidelines on Enhancing Off-grid Power Development and Operation”.

“Almost 36 [ang affected electric cooperatives], malaki ang impact nito, hindi lang sa Palawan bagkus sa buong bansa. Ang mga electric coop na deprive sa serbisyong kuryente ay entitled supposed to be sa ganitong subsidiya and yet mukhang hindi makatao ang ginagawang hakbang ng Department of Energy upang alisin ang subsidiya sa mga Small Power Utilities Group or SPUG area,” he said.

Under the Republic Act 9136 or Electric Power Industry Reform Act (EPIRA) on June 8, 2001, the law prescribed the UCME which institutionalized the provision of subsidies in areas not connected to the main grids.

 

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