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ERC Hearing on Capital Expenditure Plan   Print  E-mail 

The Energy Regulatory Commission (ERC) issued an order regarding ERC Case No. 2012-111 RC, In the Matter of the Application for Approval of Capital Expenditure Program for the Years 2011 to 2013, with Prayer for Provisional Authority. The jurisdictional hearing, expository presentation, pre-trial conference and evidentiary hearing were conducted last 22 November 2012 at the Leadership Hall, PENELCO Main Office.

Hon. Gloria Victoria C. Yap-Taruc, ERC Commissioner, presided the hearing. Atty. Ditas A. Lerios-Amboy entered her appearance as the legal counsel of PENELCO. Also present were Atty. Rhett Roswell Mislang, Clerk of the Commission; Engr. Wilfredo Manalad, ERC Technical Staff; and Mr. Joebert Dizon, ERC Stenographer. In addition, National Grid Corporation of the Philippines (NGCP) filed a petition for intervention with Atty. Jacqueline Kate T. Saliente who appeared as NGCP Counsel.

Expository presentations of the application were presented by Engr. Edwin C. Zaldivar and Ms. Ellaine S. De Guzman, the Engineering Manager and Finance Manager of PENELCO, respectively. The objectives of which are to explain the cooperative’s Capital Expenditure Program for 2011 to 2013 and the planning methodologies used, to justify that the projects will ensure the quality, reliability, security and affordability of electrical power supply in the franchise area, and to prove the financial viability of the projects considering the rate impact. The objective of the Capital Expenditure Project is to prepare and keep abreast of the growth and development of the cooperative vis-a-vis the increase in consumer’s demand and proposed additional loads within the coverage area at the same time ensuring a quality and highly efficient service the consumers deserve.

After the expository presentations, Atty. Lerios-Amboy stated that the submissions made by the applicants were all in full compliance with ERC’s directive. It was then pursued by the Pre-Trial Conference to discuss the proposals for stipulation of facts mentioned as follows:

That the proposed CAPEX projects of PENELCO are necessary for PENELCO to serve its customers in
accordance with the standards set by the Philippine Distribution Code and Philippine Grid Code as well as
other relevant cause and issuances;

That based on PENELCO’s CAPEX planned cash flow, the proposed projects can be viably pursued and implemented without necessarily affecting a significant increase in the electricity rates of PENELCO;

That this application of PENELCO is compliant with the documentary requirements under ERC Resolution 26 Series of 2009, ERC Rules of Practice and Procedure, as well as other pertinent clause, rules, and regulations; and 4. That some of the projects need immediate implementation in order for PENELCO to provide a safe, more reliable, and more efficient electric service to its consumers.

The Council of Intervener denied all the proposals for lack of knowledge. Moreover, no objection was raised on the issues to be resolved.

Atty. Lerios-Amboy proceeded with the evidentiary hearing which was the presentation of the applicants’ witnesses and documentary evidences. She reserved the right to present additional document for new evidence as may be necessary. The applicants were given fifteen (15) days to submit the documents for compliance with certain matters that were taken-up which includes approval of NGCP regarding the connection of the two newly-energized PENELCO Balanga Mirror and Pinulot Substations, rate impact of acquisition of 69 kV subtransmission assets from TRANSCO, the list of implemented CAPEX projects, amount of buffer stock utilized for the years 2011 and 2012, Lease Purchase Agreement with TRANSCO for the second phase of acquisition of subtransmission assets, agenda and minutes of Annual General Membership Assembly (AGMA) to determine if CAPEX was discussed, utilization of reinvestment fund, and PENELCO’s procurement procedure. They were also directed to furnish NGCP within the day a copy (since it was available) of application including all the annexes for NGCP to post comment on the said application.

With the approval and implementation of the capital projects, PENELCO will continuously provide its member-consumers quality and reliable electric service at the least reasonable cost.


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