TO:
- The Office of the President of the Republic of the Philippines
- The Department of Energy (DOE)
- The Energy Regulatory Commission (ERC)
- The Independent Electricity Market Operator of the Philippines (IEMOP)
- The Congress of the Philippines
SUBJECT: A Resolution Urging the Review and Reform of Electricity Pricing Methodologies, Congestion Cost Formulas and Transmission Capacity Limitations Burdening Consumers, and Requesting Congress to Review the Imposition of Value-Added Tax (VAT) on Electricity Rates.
- WHEREAS, the escalating high cost of electricity continues to heavily burden consumers, businesses and local economies within the jurisdiction of LEYECO IV;
- WHEREAS, systemic assessments reveal that high electricity rates are primarily driven by broader national energy policies, structural transmission limitations and regulatory formulas rather than localized power supply deficits or standard electric cooperative tariffs;
- WHEREAS, the 250 MW Luzon-Visayas High Voltage Direct Current (HVDC) transmission line operated by the National Grid Corporation of the Philippines (NGCP) lacks the necessary capacity to seamlessly transfer excess power from Luzon during regional supply deficits, thereby creating artificial line congestion;
- WHEREAS, under Wholesale Electricity Spot Market (WESM) rules, this line congestion prompts the Independent Electricity Market Operator of the Philippines (IEMOP) to levy an additional Line Loss and Congestion Cost (LLCC) on regional electric cooperatives, a financial penalty resulting directly from inadequate grid infrastructure;
- WHEREAS, the current congestion cost formulas approved by the Department of Energy (DOE) and the Energy Regulatory Commission (ERC) result in irregular computations that do not reflect actual electricity supplied to or consumed by end-users, creating an unfair double-charging scenario where actual power suppliers are already compensated and consumers are already paying transmission costs;
NOW, THEREFORE, WE, THE UNDERSIGNED MEMBER-CONSUMERS-OWNERS OF LEYTE IV ELECTRIC COOPERATIVE, INC. (LEYECO IV), DO HEREBY PETITION AND DEMAND:
- THE OFFICE OF THE PRESIDENT: To intervene and direct energy agencies to prioritize grid infrastructure upgrades in the whole country and pending the delivery of these critical infrastructures, directs specifically the Department of Energy (DOE) to allocate the Line Loss and Congestion Cost (LLCC) among all customers connected to the grid in consonance with the One Nation, One Grid concept to provide immediate economic relief among all electricity consumers of LEYECO IV from the unreasonably high power prices.
- THE DOE AND ERC: To immediately review, suspend or reform the Line Loss and Congestion Cost (LLCC) formulas to prevent unfair double-charging on consumers.
- THE IEMOP: To re-evaluate WESM pricing mechanisms during artificial grid congestion events.
- THE CONGRESS OF THE PHILIPPINES: To review and legislate reform or remove the imposition of Value-Added Tax (VAT) on electricity rates to provide immediate economic relief.
Member-Consumer-Owners Signature Form
By signing below, I certify that I am a registered member-consumer-owner or resident under the franchise area of LEYECO IV, and I fully support this petition.