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'
Republic of the Philippines I
ENERGY REGULATORY COMMISSIO '
San Miguel Avenue, Pasig City

IN THE MATTER OF THE

APPLICATION FOR
CONFIRMATION AND
APPROVAL OF
CALCULATIONS OF OVER
OR UNDER-RECOVERIES IN
THE IMPLEMENTATION OF
AUTOMATIC COST
ADJUSTMENTS AND TRUE-
UP MECHANISMS FOR THE
PERIOD 2011 TO 2013,
PURSUANT TO ERC
RESOLUTION NO. 16,
SERIES OF 2009, AS
AMENDED BY ERC
RESOLUTION NO. 21,
SERIES OF 2010, AND ERC
RESOLUTION NO. 23,
SERIES OF 2010;
I
-~,
ERC CASE NO. 2014-022 CF

PENINSULA ELECTRIC
COOPERATIVE, INC. DO QK E TED
Dato'
B . FEB 2 .....
..iC"7-- 2 2011~.
(PENELCO), v. . v __
..__
Applicant.

I }(-------------------------------------)(

,.
I
DECISION

I For resolution before the Commission is the 28 March 2014

Application by the Peninsula Electric Cooperative, Inc. (PENELCO)
filed on even date for confirmation and approval of calculations of
I (over) or under-recoveries in the implementation of automatic cost
adjustments and true-up mechanisms for the period 2011 to 2013,
pursuant to the Commission's Resolution No. 16, Series of 2009, as
amended by Resolution No. 21, Series of 2010 and Resolution No. 23,
Series of 2010.

FACTS

PENELCO alleged, among others, the following:

 ERC Case No. 2014-022 CF
DECISION/21 June 2016
Page 2 Of21

1. Applicant is an electric cooperative (EC) duly organized

and existing under and by virtue of the laws of the Republic of
the Philippines, with principal office at the Roman
Superhighway, Brgy. Tuyo, Balanga City;

2. It is the holder of an exclusive franchise issued by the

National Electrification Commission (NEC), to operate an
electric light and power distribution service in the
Municipalities of Dinalupihan, Hermosa, Grani, Samal,
Abucay, Pilar, Orion, Limay, Mariveles, Bagac, and Morang,
and the City of Balanga, all in the Province of Bataan;

3. The Commission's Resolution No. 16, Series of 2009, as

amended by Resolution No. 21, Series of 2010, provided the
procedure for the automatic recovery or refund of pass-
through costs and the confirmatibn process that would govern
the automatic cost adjustment and true-up mechanisms, with
the objective of ensuring appropriate recovery of the pass-
through costs in an efficient manner and to put in place a fair
and transparent process for the confirmation of the automatic
cost adjustments implemented by Distribution Utilities (DUs)
and the true-up' .of other pass-through charges involving
Generation Rate; :System Loss Rate, Transmission Rate,
Lifeline Rate ..Recovery, Inter-Class Cross-Subsidy Removal,
Treatment of Prompt Payment Discount, as the case may be.
The Commission's Resolution No. 23, Series of 2010, on the
other hand, adopts the rules implementing the discounts to
qualified senior citizen end-users and subsidy from
subsidizing end-users on electricity consumption;
\
4. Using the formulae provided in the aforesaid
Resolutions, it computed its (over) or under-recoveries
covering the period January 2011 to December 2013;

5. The results of its calculations are presented hereunder

as follows:

Actual (Over)/Under.
Pass. Through
Revenue Recovery
Cost (PhP) (PhP)
(PhP)
, Generation
Rate (GR)
4,589,561,796.05 4,486,496,717.28 103,065,078.78
Transmission
1,108,271,948.46 1,120,106,447.14 (11,834.498.69)
Rate (TR)
System Loss
560,723,805.76 567,765,855.39 (7,042,049.63)
Rate (SLR)
Lifeline Rate
(LR) - - (1,839.478.39)
Senior Citizen -
Discount
- (14,225.25)

Net Results - - 82,334,826.83

 ERC Case No. 2014-022 CF
DECISION/21 June 2016
Page 3 Of21

Summaries of the net results of its computation on the

foregoing pass-through charges are attached in the
Application as Annexes "A"to "E";

6. in support of its computations, it attached the following

data and documents in the Applicationas Annex"F":

a) Supplier and Transmission Data Sheet;

b) Statistical Data Sheet;
c) Implemented Rates Data Sheet;
d) Power Billsof Power Suppliers;
e) OfficialReceipts(OR)issued by Power Suppliers;
f) Breakdown of Payments with ORs from Power
Suppliers;
g) Debit/Credit Memoof Power Suppliers;
h) National Grid Corporation of the Philippines
(NGCP)Invoices;
!
, i)
j)
OfficialReceiptsissued by NGCP;
Breakdownof Paymentswith ORsfrom NGCP;
k) Debit/Credit Memoissued by NGCP;
I) Monthly Financial and Statistical Report (MFSR)
(SectionsB and E); and
m) Consumer Bills of Lifeline (per level) and Non-
1
I
Lifeliners(per customer class)
I
7. It prays that the calculations for its (over) or under-
recoveries, after due notice and hearing, be confirmed and
approved and that it be allowedto refund its (over)-recoveries
and collect its under-recoveries, as the case maybe, to or from
its customers.

The Commission having found said Application to be sufficient

in form and substance issued an Order and a Notice of Public
Hearing, both dated 13 May 2014, setting the case for initial hearing
on 17June 2014.

The Order directed PENELCO to cause the publication of the

Notice of Public Hearing, at its own expense, once (lX) in a newspaper
of general circulation in the Philippines, not later than ten (10) days
before the date of the scheduled initial hearing. It was also directed to
inform the consumers within its franchise area of the filing of the
Application, its reasons therefore, and of the scheduled hearing, by
any other means available and appropriate.

PENELCO was likewise directed to furnish the Office of the

Solicitor General (OSG), the Commission on Audit (COA), the
Committees on Energy of both Houses of Congress, the Office of the '
Provincial Governor of Bataan and the mayors of the city and
 ERC Case No. 2014-022 CF
DECISIONj21 June 2016
Page40f21

municipalities within its franchise area, with copies of the

Application, Order, and Notice of Public Hearing, for the appropriate
posting thereof on their respective bulletin boards.

PENELCO filed its Pre-trial Brief dated 05 June 2014 on even

date, with the Judicial Affidavit of Marilou C. Gonzales dated 05 May
2014.

During the hearing on' 17 June 2014,PENELCO filed its

Compliance with Jurisdictional Requirements dated 16 June 2014. It
then presented documents as proofs of compliance duly marked as
Exhibits "A" to "0-1", which the Commission found to be fully
complied with. There was no Intervenor or Oppositor who appeared
nor was there any intervention or opposition registered.

PENELCO presented during the Expository Presentation

Marilou C. Gonzales, PENELCO's Manager of Energy Trading,
Corporate Planning and Information Technology Office, who
delivered under oath the said presentation. Thereafter, the
Commission terminated the expository presentation and proceeded
with the Pre-trial and Evidentiary Presentation.

During the evidentiary presentation, PENELCO presented again

Ms. Gonzales as its lone witness, who testified in support of the

I, instant Application. In the course thereof, various documents were

identified and marked as exhibits.

After the direct examination, the Commission propounded

c!arificatory questions on the said witness. Thereafter, PENELCO
moved that an Order of General Default be issued against those who
failed to appear in the said hearing. Finding the said motion
meritorious, the Commission granted the same. Thereafter, the
Commission directed PENELCOto submit its formal offer of evidence
and the required additional documents.

On 20 June PENELCO filed before the Commission its

2014,
Formal Offer of Evidence dated 19 June 2014.

An Order dated 14 June 2016 was issued by the Commission on

even date admitting PENELCO's marked exhibits contained in its
Formal Offer of Evidence, and submitting the case for resolution.

1I
I
 ERC Case No. 2014-022 CF
DECISION/21 June 2016
Pages Of21

ISSUE

The issue to be resolved is whether the Commission should

confirm and approve PENELCO's calculations of its (over) or under-
recovery for the period January 2011 to December 2013, pursuant to
the Commission's Resolution No. 16, Series of 2009, as amended by
Resolution No. 21, Series of 2010 and Resolution No. 23, Series of
2010.

COMMISSION'S RULING

The Commission approves with modification the calculations of

(over) and under-recoveries of PENELCO for the period 2011 to 2013.

Consequently, PENELCO is directed to refund the following

amounts starting on the next billing cycle from receipt of this
Decision until such time that the full amount shall have been
refunded:

a) Transmission Cost (over)-recoveries

amounting to Twenty-Two Million Nine Hundred Twenty-
Six Thousand Six Hundred Thirty-Seven and 58/100
Pesos or PhP(22,926,637.58), or its equivalent rates per
respective customer class for the period of thirty-six (36)
I
,
months or until the said amount have been fully refunded,
to wit:

Customer Class PhP/kWh PhP/kW

Residential (0.0230)
Low Voltage (0.0166)
Higher Voltage (1.0741)

b) System Loss - (over)-recoveries amounting to

Forty-One Million Five Hundred Sixty-Eight Thousand
Seven Hundred Seventy-One and 93/100 Pesos or
PhP(41,568,771.93), or an equivalent rate of
PhP(0.0277)/kWh for the period of thirty-six (36) months
or until the said amount shall have been fully refunded to
its customers; and

c) Senior Citizen Subsidy - (over)-recoveries

amounting to Eighteen Thousand Six Hundred and
Eleven Pesos or PhP(18,611.00), or an equivalent rate of

,
ERC Case No. 2014-022 CF
DECISION/21 June 2016
Page 6 Of21

PhP(0.0005)/kWh for a period of one (1) month or until

the said amount shall have been fully refunded to its
subsidizing customers.

On the other hand, PENELCO is directed to collect the

following amounts starting on the next billing cycle from receipt
hereof until such time that the full amount shall have been collected
from its customers:

a) Generation Cost - under-recoveries amounting

to Ninety-One Million Twenty-Seven Thousand Four
Hundred Sixty-Two and 59/100 Pesos or
PhP91,027,462.59, or an equivalent rate of
PhPo.0606/kWh for the period of thirty-six (36) months
or until the said amount have been fully collected from its
customers;

b) Lifeline Subsidy - under-recoveries amounting to

Two Million Four Hundred Sixty Thousand Three
Hundred Ninety-Three and 96/100 Pesos or
PhP2,460,393.96, or an equivalent rate of
PhPO.0101/kWh for the period of six (6) months or until
the said amount have been fully collected from its
customers.

DISCUSSION

In its Application, PENELCO sought the approval of the

Commission ofthe following (over) and under-recoveries:

Pass-Through Actual (Over) fUnder-

Cost (PhP) Revenue Recovery
(PhP) (PhP)
Generation Rate
(GR) 4,589,561,796.05 4,486,496,7'7.28 103,065,078.78
Transmission Rate
1,108,271,948,46 1,120,106,447.14 (11,834,498.69)
(TR)
System Loss Rate
560,723,805.76 567,765,855.39 (7,042,049.63)
(SLR)
Lifeline Rate (LR) - - (181Q,478.19)
Senior Citizen
- - (14,225.25)
Discount
Net Results - - 82 826.83
ERC Case No. 2014-022 CF
DECISION/21 June 2016
Page 70f21

Pursuant to Resolution No. 16, Series of 2009, entitled A

Resolution Adopting the Rules Governing the Automatic Cost
Adjustment and True-Up Mechanisms and Corresponding
Confirmation Process for Distribution Utilities, as amended by
Resolution No. 21, Series of 2010, entitled A Resolution Amending
Section 4 of Article 4 and Section 1 of Article 5 of the Rules
Governing the Automatic Cost Adjustment and True-Up
Mechanisms and Corresponding Confirmation Process for
Distribution Utilities, and Resolution No. 23, Series of 2010, entitled
A Resolution Adopting the Rules Implementing the Discounts to
Qualified Senior Citizen End-Users and Subsidy from the
Subsidizing End-Users on Electricity Consumption under Sections 4
and 5 of Republic Act No. 9994, the formulae below were adopted in
the computation of the following: 1) Generation Rate; 2)
Transmission Rate; 3) System Loss; 4) Lifeline Subsidy; and 5) Senior
Citizen Discount and Subsidy:

Generation Rate:

[(AGC - GRR )+ rGOUR ]

GOUR =-----------
S GOUR To',,1

Where:

GaUR = Refers to (over) or under-recoveries in

generation costs during the recovery
period expressed in Peso/kWh

AGC = Refers to total allowable generation cost,

computed as follows:

AGe _- '"
L. [(GC; + GC;; + ...GcJ- 50%(PPD;
~~-~--~--~----------- + PPD;; + ...PPDn)- PCReauR )s
GOIIR
]
l ..m TPG GOflR

Transmission Rate:

For customer classes with Transmission Rate (TR) expressed in

Peso/kWh:
. [(ATCN -TRRN)+rTOURN]
TOURN =~--------
8roURN

For customer classes with TR expressed in Peso/kW and

Customer classes with TR expressed in both Peso/kWh and
Peso/kW:
 ERC Case No. 2014-022 CF
DECISION/21 June 2016
Page 80f21

Where:

TOURN = Refers to (over) or under-recoveries in

transmission cost during the recovery
period expressed in Peso/kWh for class
N .

ATC = Refers to the actual transmission cost

during the recovery period computed as
follows:

I ATC = ",[(TC - SO%PFDJS IP

N LJ TPG TOUR N

I I .m TOUR

System Loss:

SLOUR= [(ASLC-ASLR)+rSLOUR]
SSLOUR

Where:
)
SLOUR = Refers to (over) or under-recoveries in
system loss during the recovery period
expressed in Peso/kWh

ASLC = Allowable System Loss Cost incurred

during the recovery period determined
as follows:

ASLC = ASLCn + ASLCY2 + ... ASLCy"

f
I Where:

ASLC = ([GTGCy + TCy -SO%PFDrJUJS

Yl., TPGy TPGy Y

Lifeline Subsidy:

LD
LSOUR=~---
S LSOURN1A'(JTAI.

I,
I
 ERC Case No. 2014-022 CF
DECISION/21 June 2016
Page90f21

Where:

LSOUR = Refers to (over) or under-recoveries on

lifeline subsidy during the recovery
period expressed in Peso/kWh

LD = Difference between the Total Discounts

given to lifeline customers and Total
Subsidy collected from non-lifeline
customers, computed as follows:

LD= I(TS-TD)
1 L.rn
Where:

TS = Lifeline subsidy amount collected from

non-lifeline customers for month 1 to m,
computed as follows:

TS = SLsaUR x LSR
M.

Where:

SLSOURNL = total kWh consumption of non-

I LSR =
lifeline customers for the month

lifeline subsidy rate per kWh

I collected from non-lifeline
customers for the month
I
\
TD total discount amount given to
lifeline customers for month 1 to
\ m, computed as follows:

TO, = :L[((SLsau~,xTRate)+(NCuS~L x Fixed/ Cust))x D]

j=1...n

Senior Citizen Subsidy:

. SrDiffs_D
SrDSOUR= -k-W-"-S---
SrDSOURs];u

Where:

SrDSOUR = Refers to the (over) or under-recoveries

on senior citizen discounts and subsidy
 ERC Case No. 2014-022 CF
DECISION/21 June 2016
Page 10 Of21
1
during the recovery period subject for
verification expressed in PhP/kWh

SrDiffs_D = Summation of the difference between

the total subsidy collected from all
subsidizing end-users and the total
discounts granted to senior citizen
end-users for each and every recovery
month within the period covered by the
verification process, computed as
follows:

SrDiffs_D -- L
'\(TS SEV, -
TD)SrI

I
L .. :J1.

Where:

= Total amount of subsidy collected

from all subsidizing end-users for
the recovery month, computed as
follows:

! TSSEV, = SrSRSEV, x kWhSsou,

Where:

SrSRSEUr = Senior Citizen Subsidy

Rate expressed in
Peso/kWh implemented
or collected from all
subsidizing end-users for
the recovery month
I
I
kWhSsEU, = Total kWh Sales to all
subsidizing end-users for
the recovery month

Total amount of discounts

implemented or granted to all
qualified senior citizen end-users for
the recovery month, computed as
follows:
ERC Case No. 2014-022 CF
DECISION/21 June 2016
Page 11 Of21

Where:

I.TDsrRosZ, = Total amount of discount

implemented or granted to
all qualified residential
senior citizens customer for
the recovery month

I. TDsr1=t, - Total amount of discount

implemented or granted to
all qualified senior citizen
centers and residential care
facilities/institutions or
group homes for the
recovery month

After a thorough evaluation of the instant Application, the

Commission adopted the following considerations in determining the
resulting (over) or under-recoveries ofPENELCO:

Particulars PENELCO's Basis Commission's Basis

Generation Generation cost was The Commission
based on the invoices utilized the same
issued by its power documents used by
suppliers: PENELCO as basis, in
1. Wholesale accordance with the
Electricity Spot Commission's
Market (WESM) - Resolution No. 16,
(January 2011 to Series of 2009, as
December 2013); amended by Resolution
2. San Miguel Energy No. 21, Series of 2010.
Corporation (SMEC)
- (January 2011 to
December 2012);
3. Bataan 2020 -
January 2011 to
March 2011 and
August 2011 to
August 2012; and
4. GN Power Mariveles
Coal Plant Ltd. Co.
Partners (GMCP) -
(January 2013 to
December 2013).
 ERC Case No. 2014-022 CF
DECISIONj21 June 2016
Page 12 Of21

Transmission Transmission cost was The Commission

based on NGCP invoices utilized the same
and Official Receipts for documents used by
the whole period of PENELCO as basis, in
confirmation. accordance vrith the
Commission's
Resolution No. 16,
Series of 2009, as
amended by Resolution
No. 21, Series of 2010.

Discounts:

Power Factor Transmission cost was Same policies were

Discount (PFD) determined net of the applied by the
50% PFD availed from Commission, m
NGCP. accordance vrith
Resolution No. 16,
Prompt PENELCO availed the Series of 2009, as
Payment 50% Efficiency Discount amended by Resolution
Discount (PPD) from January 2011 to No. 21, Series of 2010.
Efficiency December 2013.
Perrormance
Security

kWh Purchased The kWh purchases The Commission

based on the mVOlces utilized the same
from the follovring: documents used by
1. WESM - (January PENELCO as basis, in
2011 to December accordance vrith the
2013); Commission's
2. SMEC - (January Resolution No. 16,
2011 to December Series of 2009, as
2012); amended by Resolution
3. Bataan 2020 - No. 21, Series of 2010.
January 2011 to
I, March 2011 and
I August 2011 to
August 2012; and
4. GMCP - (January
2013 to December
2013).

kWh Sales The total kWh Sales of Actual kWh Sales of the
the preVIOUS months current month based
based on the submitted on the submitted
Monthlv Financial and MFSR, oursuant to

(
I
 ERC Case No. 2014-022 CF
DECISION/21 June 2016
Page 13 Of21

Statistical Report Resolution No. 16,

(MFSR). Series of 2009, as
amended by Resolution
No. 21, Series of 2010.

System Loss Actual system loss for The actual annual

the previous 12 months system loss or the cap,
or the cap, whichever is whichever IS lower,
lower, based on the based on the submitted
submitted MFSR. MFSR, pursuant to
Resolution No. 16,
Series of 2009, as
amended by Resolution
No. 21, Series of 2010.

The resulting (over) or

under recoveries on
Generation Rate (GR)
and Transmission Rate
(TR) have impact on

I Company Use PENELCO did not

the System Loss (SL)
computation.

Per ERC Resolution

include the Company No. 11, Series of 2010,
Use (CU) in the kWh the CU must be
Sales in year 2011. included in kWh Sales
starting July 2010.

Lifeline Computed monthly Computed monthly

usmg the preVIOUSusing current months'
months' data. data, pursuant to
Resolution No. 16,
Series of 2009, as
amended by Resolution
No. 21, Series of 2010.

Senior Citizen Computed monthly Computed monthly

Subsidy usmg the preVIOUSusing current months'
months' data. data, pursuant to the
Commission's
Resolution No. 23,
Series of 2010.

The monthly variance

m the kWh Sales of
both the subsidizin"
 ERC Case No. 2014-022 CF
DECISION/21 June 2016
Page 140f21

and the subsidized

customers resulted to
an (over)-recovery.

Moreover, the Commission noted the following observations,

upon further evaluation of the instant Application:

1. For Calendar Year (eY) 2013, the spikes in the WESM

prices as a result of the Malampaya shutdown in November
and December 2013 contributed to the under-recovery in
the generation. It is significant to note that the Commission
issued a Decision dated 03 March 2014 relative to the said
incident wherein a Regulated Price was approved instead of
the WESM Price. However, PENELCO had already
implemented the price of WESM to its consumers before the
issuance of the said Decision. Thus, PENELCO's actual
implementation and the formula in the confirmation of the
generation cost (current to current) resulted to under-
recovery amounting to One Hundred Four Million One
Hundred Fifty-Four Thousand Nine Hundred and Ninety-
I Seven Pesos or PhP104,154,997.00 for CY2013.

2. PENELCO failed to include in its total kWh Sales

the Company Use in year 2011, which is mandatory under
ERC Resolution No. 11,Series of 2010.

3. The erroneous input of transmission rate in lower

voltage customer class for the month of August 2013
, resulted to lower revenue.

\ Pursuant to Article 4 of the Rules Governing the Automatic

Cost Adjustment and True-up Mechanism and Corresponding
Confirmation Process for Distribution Utilities, the total running
balance of the refund or collection as a result of any previous
confirmation should be included in determining the new cost
adjustment. Thus, the Commission verified the monthly reports
submitted by PENELCO relative to its previously approved (over) or
under-recoveries under the Decision dated 26 November 2012 (2012
Decision) issued in ERC Case No. 2011-061 CF.

Furthermore, the Commission verified the allegation of

PENELCO in its letter dated 03 November 2015 that it had fully
complied with the 2012 Decision and in fact incurred an over-refund
 ERC Case No. 2014-022 CF
DECISION/21 June 2016
Page 15 of21

of Three Million Four Hundred Eighty-Three Thousand Eight

Hundred Twenty-Nine and 01/100 Pesos or PhP3,483,829.01. Upon
verification of the submitted documents, it was found that PENELCO
indeed incurred an over-refund in the implementation of the
Commission's 2012 Decision. However, the said amount was reduced
to Three Million One Hundred Sixty-Three Thousand Sixty-Nine and
32/100 Pesos or PhP3,163,069.32, broken down as follows:

Verified Over-
Particular Charges Refunded Amount
(PhP)
Generation 254,233.60
Transmission 2,009,588.19
System Loss 467,618.69
Lifeline Subsidy 431,628.84
Senior Citizen Subsidy 0
Inter-class Cross-subsidy -
Reinstated PPD -
Total of the over-refunded
3,163,069.32
, amount
I
Considering all the foregoing in the present Application, the
Commission verified and confirmed the following pass-through costs:

I
Particular Charges
Generation
Transmission
S stem Loss
Lifeline Subsid
Senior Citizen
Total(Over)/Under-
Recoveries

> To calculate the net cost adjustments and the corresponding

. (over) or under-recoveries (current and previous) incurred by
PENELCO, the Commission considered the following data:

a) the verified over-refunded amount of the prevIOus

confirmation amounting to Three Million One Hundred
Sixty-Three Thousand Sixty-Nine and 32/100 Pesos or
PhP3,163,069.32;

.,
 ERC Case No. 2014-022 CF
DECISION/21 June 2016
Page 170f21

Accordingly, PENELCO is hereby directed to REFUND the

following amounts starting on the next billing cycle from receipt
\, hereof until such time that the full amount shall have been refunded:

a) TRANSMISSION COST - (over)-recoveries

amounting to Twenty-Two Million Nine Hundred Twenty-
Six Thousand Six Hundred Thirty-Seven and 58/100
Pesos or PhP(22,926,637.58), or its equivalent rates per
customer class for the period of thirty-six (36) months or
until the said amount have been fully refunded, to wit:

Customer Class .. PhP kWh PhP kW

Residential (0.02 0)
LowVolta e (0.0166)
Hi her Volta e (1.0 1)

b) SYSTEM LOSS - (over)-recoveries amounting to

Forty-One Million Five Hundred Sixty-Eight Thousand
Seven Hundred Seventy-One and 93/100 Pesos or
PhP(41,568,771.93), or an equivalent rate of
PhP(0.0277)/kWh for the period of thirty-six (36) months
or until the said amount shall have been fully refunded to
! its customers; and

c) SENIOR CITIZEN SUBSIDY - (over)-recoveries

. amounting to Eighteen Thousand Six Hundred and
Eleven Pesos or PhP(18,611.00), or an equivalent rate of
PhP(0.0005)/kWh for a period of one (1) month or until
the said amount shall have been fully refunded to its
subsidizing customers.

On the other hand, PENELCO is hereby directed to COLLECT

the following amounts starting on the next billing cycle from receipt
I hereof until such time that the full amount shall have been collected
from its customers:

a) GENERATION COST under-recoveries

amounting to Ninety-One Million Twenty-Seven
Thousand Four Hundred Sixty-Two and 59/100 Pesos or
PhP91,027,462.59, or an equivalent rate of
PhPo.0606/kWh for the period of thirty-six (36) months
or until the said amount have been fully collected from its
customers;
ERC Case No. 2014-022 CF
DECISION/21 June 2016
Page 18 Of21

b) LIFELINE SUBSIDY under-recoveries

amounting to Two Million Four Hundred Sixty Thousand
Three Hundred Ninety-Three and 96/100 Pesos or
PhP2,460,393.96, or an equivalent rate of
PhPO.0101/kWh for the period of six (6) months or until
the said amount have been fully collected from its
customers.

In connection therewith, PENELCO is hereby directed to

comply with the following:

a) SUBMIT within ten (10) days from its

implementation, a sworn statement indicating its
compliance with the aforesaid directives;

b) REFLECT the (over) or under-recoveries m the

monthly computations of Generation Rate (GR),
Transmission Rate (TR), System Loss Rate (SLR), Lifeline
Subsidy Rate (LSR) and Senior Citizen Subsidy Rate
(SrSR) as "OGA" for Generation, "OTCA" for
Transmission, "OSLA" for System Loss, "OLRA" for
Lifeline Subsidy and "OSrRA"for Senior Citizen Subsidy;
and

c) ACCOMPLISH and SUBMIT a report, in

accordance with the attached prescribed format, on or
before the 30th day of the following month together with
the monthly reportorial requirements, and every month
thereafter, until the amount shall have been fully
refunded or collected.

Finally, PENELCO is directed to strictly comply with the

foregoing directives and immediately implement the same in the next
billing cycle upon receipt hereof.

SO ORDERED ..
 ERC Case No. 2014-022 CF
DECISION/21 June 2016
Page 16 Of21

b) the resulting under-recoveries subject of the instant

Application amounting to Twenty-Five Million Eight
Hundred Ten Thousand Seven Hundred Sixty-Six and
72/100 Pesos or PhP25,81O,766.72;and

c) the March 2016 kWh Sales.

I Based on the foregoing, PENELCO's computed net under-

recoveries amounted to Twenty-Eight Million Nine Hundred Seventy-
Three Thousand Eight Hundred Thirty-Six and 04/100 Pesos or
PhP28,973,836.04, as shown below:

I (Over) fUnder- Recoveries

Number
Particulars PhPf PhPf
of Months InPhP
f kWh kW
Generation 36 91,027,462.59 0.0606
Transmission 36 (22,926,637.58
Residential (0.0230)
Low Voltage (0.D166)
Higher Voltage (1.0741)
System Loss 36 (41,568,771.93 (0.0277)
Lifeline Subsidy 6 2,460,393.96 0.0101
Senior Citizen
1 (18,611.00) (0.0005)
SubsidY
TOTAL 28,973,836.04

. It must be noted that there is a substantial disparity between

the under-recovery prayed for by PENELCOand the verified amount.
In this regard, PENELCO is reminded to be more circumspect in the
preparation of its application submitted before the Commission.
PENELCO is expected at all times to exude fair dealing, which
includes the careful preparation of information embodied in its
application or petitions before the Commission.

WHEREFORE, the foregoing premises considered, the

Application filed by Peninsula Electric Cooperative, Inc. (PENELCO),
for confirmation and approval of calculations of (over) or under-
recoveries in the implementation of automatic cost adjustments and
true-up mechanisms for the period 2011 to 2013, pursuant to the
Commission's Resolution No. 16, Series of 2009, as amended by
Resolution No. 21, Series of 2010 and Resolution No. 23, Series of
2010, is hereby APPROVED WITH MODIFICATION.

j
 ERC Case No. 2014-022 CF
DECISION/21 June 2016
Page 19 Of21

Pasig City, 21 June 2016.

-
0( Chairman and CEO ' 'B-2017-017-0C-00391' '

~Do"/.NON 01, r>"Il~(t}1 ~

ALFRE f. r GliORiAVICT()~. YAP-TARDC
Commissioner COmmlsswner .

(on leave) (on official travel)

JOSEFINA PATRICIAA. MAGPALE-ASIRIT GERONIMO D. STA,ANA
I, ., I '

I Commissioner Commissioner .
,1

,
f!
IED;t/ jPENELCO Decision 2014-022CF "

LS:AR
~

I
I
 ERC Case No. 2014-022 CF
DECISIONj21 June 2016
Page200f21

Copy Furnished:

1. Lerios-Amboy PingoI & Gonzales Law Offices

Counselfor PENELCO
Units 1609-1610, Tycoon Centre
Pearl Drive, Ortigas Avenue, Pasig City

2. Peninsula Electric Cooperative, Inc. (PENELCO)

Roman Superhighway,
Brgy. Tnyo, Balnga City

3. The Office ofthe Solicitor General

\ 134 Amorsolo Street, Legaspi Village, Makati City
i Metro Manila

4. The Commission on Audit

I,
Commonwealth Avenue
Quezon City, Metro Mauila
,,
5. The Senate Committee on Energy
j Senate of the Philippines

I
I 6.
GSIS Building, Roxas Blvd., Pasay City, Metro Manila
,
The House Committee on.Energy
i House of Representatives r.'
Batasan Hills, Quezon City, Metr~Manila
I ,
,
7. Office of the President ~~
Philippine Chamber of Commerce and Industry (PCCI)
3'd Floor, Chamber and Indnstry Plaza (CIP)
I, 1030 Campus Avenue corner Park Avenue ...
McKinley Town Center, Fort B.oni!~cio.Taguig City

8. Office of the Governor

Province of Bataan
,, .,.
, "
9. Office of the City Mayor
\,.,1

I 10.
Balanga, Bataan

Office ofthe Municipal Mayor

~ Dinalupihan, Bataan
\
,
,
1
11. Office of the Municipal Mayor
Hermosa, Bataan
1

I
12. Office ofthe Municipal Mayor
Orani, Bataan

Office of the Municipal Mayor

Samal, Bataan
, 14. Office of the Municipal Mayor
!I Abucay, Bataan

I ,
I
 ERC Case No. 2014-022 CF
DECISION/21 June 2016
Page 21 Of21

'5. Office of the Municipal Mayor

Pilar, Bataan

16. Office ofthe Municipal Mayor

Orion, Bataan

'7. Office ofthe Municipal Mayor

Limay, Bataan

18. Office of the Municipal Mayor

Mariveles, Bataan

'9. Office of the Municipal Mayor

Bagac, Bataan

20. Office ofthe Municipal Mayor

Morang, Bataan

21. Investigation and Enforcement Division (lED)

Energy Regulatory Commission
17thFloor, Pacific Center Building, San Miguel Avenue, Pasig City

I
!
I
I
,,

I
,
,

I
I,
 Other Generation Rate Adjustment (OGA) Charge

Name of DU: "Tiih;;;O,C,Oe~p~o;;rtC,;;h;;oCu;;'d;;-;bC.e;-;;,;;uhb;;m~;tl"eCd'-;oC"Co;;,'"""'b~e;;fo;;,~e.t;;hOec3;;O;;t"h

ERC Case No.:
Order Date: of the following month, together with the monthly
Total Amount to be reportorial requirement. and every month thereafter
Collected: until the amount shall have been fully recovered,
Rate per kWh (PhP/kWh):

Other Generation 'Rate Adjustment (OGA) Charge

Amount Collected/Refund
For the Period Covering
.

,, Month Rate/kWh kWh Sold1 Amount Collected Balance in Amount

, Beginning Balance
0.00
j Customer Class

; 1. .

2.
3.
4.
115.
TOTAL
Ending Balance 0,00
:/ Indicate the kWh sold used In Ihe catculatlon of collect

Prepared by: Reviewed by: Certified True and Correcl

(Name & Position) Finance/Billing Manager General Manager

, OATH
'SUBSCRIBED AND SWORN to before me Ihis day of 201 al _
IThe affiant exhibited to me his/her CTC No, issued on ,, _

Nolary Public

 Other Transmission Cost Adjustment (OTCA) Charge

~ Name of DU: This report should be submitted on or before the 30th

ERC Case No.:
of the following month, together with the monthly
Order Date:
Total Amount to be reportorial requirement, and every month thereafter
Collected: until the amount shall have been fully recovered.
Rate per kWh (PhP/kWh):

Other Transmission Cost Adjustment (OTCA) Charge

Amount Collected
For the Period Covering

Month Rate/kWh kWh Sold1 Amount Collected Balance in Amount

,, Beginning Balance 0.00

: Customer Class
I
; 1.
12.
3.

4.
5.
, TOTAL
I
l :/ Ending Balance
Indicate the kWh sold used in the calculation of collecl,
0,00

Prepared by: Reviewed by Certified True and Correct.

(Name & Position) Finance/Billing Manager General Manager

I OATH
; SUBSCRIBED AND SWORN to before me this _' _ day of ,201 at _
I The affiant exhibited to me his/her CTC No. issued on " _
I .
Notary Public
 Other System loss Cost Adjustment (OSlA) Charge

I Name of DU: This report should be submitted on or before the 30th

ERC Case No.:
of the following month, together with the monthly
Order Date:
Total Amount to be reportorial requirement, and every month thereafter
Collected: until the amount shall have been fully recovered.
\, Rate per kWh (PhP/kWh):

Other System Loss Cost Adjustment (OSlA) Charge

Amount ColiectedfRefund
For the Period Covering

,
Month Rate/kWh kWh Soldl Amount Collected Balance in Amount

1 Beginning Balance 0.00

. Customer Class

1"
112.
,
1
3.

4.

5.
TOTAL
Ending Balance 0,00
~/ Indicate the kWh sold used in the calculation of collect.

,
'Prepared by Reviewed by Certified True and Correct

(Name & Position) Finance/Billing Manager General Manager

t OATH
[SUBSCRIBED AND SWORN to before me this day of ,201 at
~he affiant exhibited to me his/her CTC No. issued on ~ "

Notary Public

 Other Lifeline Rate Cost Adjustment (OLRA) Charge

Name of DU: This report should be submilled on or before the 30th

: ERC Case No.:

I
of the following month, together with the monthly
Order Date:
Total Amount to be reportorial requirement, and every month thereafter
. Collected: until the amount shall have been fully recovered .
, Rate per kWh (PhPlkWh):

!
Other Lifeline Rate Cost Adjustment (OLRA) Charge
Amount Collected/Refund
For the Period Covering ~ _

Month Rate/kWh kWh Soldl Amount Collected Balance in Amount

Beginning Balance 0.00

Customer Class .
1.
', .

,,
~.
5,
I TOTAL
I.
I:;'' ,,,''"
Ending Balance 0,00
kWh wid "','" '" o,lwl,';,,", 0011,01.

P.repared by: Reviewed by. Certified True and Correct:

(Name & Position) Finance/Billing Manager General Manager

OATH
S,UBSCRIBED AND SWORN to before me this day of , 201 at ~~_
I
The affiant exhibited 10 me his/her CTC No
--~~--- issued on
- ---~~~~-
at

Notary Pubiic
 Senior Citizen Discount & Subsidy Over Under Recovery

1 Name of DU: This report should be submitted on or before the 30th

ERC Case No.:
of the following month, together with the monthly
IOrder Date:
. Total Amount to be reportorial requirement, and every month thereafter

,
iCollected: until the amount shall have been fully recovered.
Rate per kWh (PhPfkWh):

Senior Citizen Discount & Subsidy Over Under Recovery

Amount Collected/Refund
For the Period Covering ~ __ ~ _

t
;
Month RatefkWh kWh Sold' Amount Collected Balance in Amount

I Beginning Balance 0.00

Customer
, Class

1.: .
,
2.,
3\
4. \

5. \
t TOTAL
I Ending Balance 0,00
:/ilndicele Ihe kWh sold used In the calculation of col/ect

Pre!?ared by. Reviewed by: Certified True and Correct:

(Name & POsition) Finance/Billing Manager General Manager

OATH
SUBSCRIBED AND SWORN to before me thiS day of 201 at
The Mlianl exhibited to me his/her CTC No issued on ,' __ .

Notary Public

\
\