MAYOR Eric C. Codilla proposed to Leyte-V Electric Cooperative Inc. to utilize its patronage credit to finance its planned five-year Capital Expenditures (Capex) worth P1.045 billion. Leyeco V proposes to increase electricity rates by 77¢ per kWh to amortize the loan for the Capex.
Mayor Codilla has stepped into the dilemma on the need to upgrade Leyeco V’s infrastructure and facilities versus the consumers’ protest on the looming power rate increase. He wants to find a solution that would allow Leyeco V to implement its Capex without resorting to rate hikes.
Being an electric coop, Leyeco V earns margins instead of profits which includes patronage credit estimated at P20-30 million annually. This patronage credit is given back to consumers in the form of lifeline rate subsidy. However, this socialized pricing mechanism benefits only low-income power consumers.
Leyeco V also approved during its general assembly in May 28 last year a P5,000 mortuary benefit per registered consumers to be charged from the patronage credit. But Mayor Codilla said spending the patronage credit on the Capex instead of resorting to rate increase would bear more impact to majority of consumers than the benefits it is currently being used for.
“Kini nga income nga ibalik ngadto sa konsumidor, mga 10 sentabos lang tingali o wala ba kaha kaabot. Gamay ra kaayo ni kontra sa ilang increase nga 77 sentabos. So kini na lang ang ilang i-amortize nga maoy ibayad sa loan,” Mayor Codilla proposes.
Leyeco V BOD President Joselito P. Yap said he is amenable with Mayor Codilla’s suggestion but they have to seek approval first from Energy Regulatory Commission considering the lifeline rate subsidy is mandatory in section 73 of the Electric Power Industry Reform Act.
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