THE National Association of Electricity Consumers for Reforms, Inc. (Nasecore) is not entirely against the capital expenditures (Capex) applied for by Leyte-V Electric Cooperative (Leyeco V). Its objective rather, is to reduce the Capex funds sought by Leyeco V.
This was bared by Nasecore Regional Coordinator Rodolfo F. Celestial in a power forum last Nov. 26. He is referring to the P1,045,162,099.91 Capex being applied by Leyeco V before the Energy Regulatory Commission to finance its five-year Distribution Development Plan (DDP).
The catch is that Leyeco V will raise the Members’ Contribution for Capital Expenditures charge by 7719¢/kWh, from 2904¢/kWh to P1.0623/kWh. “It might not be very much but you must bear in mind that an ordinary household consumes at least a thousand kWh in a month,” Celestial said.
He doesn’t see the logic of applying for a Capex for its DDP when Leyeco V has an annual reinvestment fund (RF) representing 5% of its gross revenue. From 2004 to ’09, Leyeco V had P172,146,136.84 RF. He was also informed that Leyeco V didn’t spend its RF from 2004 to ’06 totaling P75,171,658.29 and there was only minimal expense for ’07.
“They’ve been collecting from us but they didn’t spend the money. I don’t know where they put that money,” Celestial said. But a Leyeco V source said the RF is meant for System Rehab/Upgrading and/or System Loss Reduction Plan and can’t be spent for DDP.
“What we’re saying here is this: you’re asking for P1 billion; can you please tell us what you did with what we gave you before?” Celestial said, adding that he agrees some of the items in the DDP are actually needed. “We need some of it. But prove to us that you judiciously spent your budget before.”
“What we’re saying here is this: you’re asking for P1 billion; can you please tell us what you did with what we gave you before?” Celestial said, adding that he agrees some of the items in the DDP are actually needed. “We need some of it. But prove to us that you judiciously spent your budget before.”
He also said that the DDP items should follow the three criteria for expenses of utilities set by the Electric Power Industry Reform Act. These are: 1) it must be needed; 2) must be recurring; and 3) must redound to consumers’ interest. He warned against items in the DDP especially non-network projects worth P136,728,847.37 that have nothing to do with delivering electricity.
Included here is a 5,000 capacity covered court worth P3 million. Celestial bets the amount isn’t enough and Leyeco V will still need more money to finish the structure. With their own covered court, Institutional Service Department Manager Maximo Torcende said Leyeco V doesn’t have to rent a venue for its annual general assembly.
Energy Regulatory Board conducted a hearing last Nov. 9 but was suspended by Commissioner Alfredo J. Non who ordered Leyeco V to hold a consumers’ orientation first on Dec. 2 so that questions on the next hearing will be limited solely on the Capex application.
“Our presence in the hearing was not necessarily to go against their proposal which is to improve Leyeco V, but to find out if they can be trusted to spend the money that they’re asking for or if we can do something to reduce that,” Celestial said. by Felix N. Codilla III
(WLWE issue of Nov. 21-27, 2011)
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