LKI Statement on attacks against Meralco

 Laban Konsyumer Inc. (LKI) is calling for legislators and other critics to refrain from attacking Meralco, but instead help find effective ways and alternative solutions to provide electricity consumers with reliable power supply at the least cost.

Lately, LKI noticed several 'caused-oriented groups', including lawmakers with vested interests, issuing negative statements on Meralco's alleged overcharging that stemmed from Energy Regulatory Commission's (ERC) failure to update the computation for the Weighted Average Cost of Capital (WACC).

The WACC is a regulator-set mechanism that applies to the industry, not just to Meralco, but to other distributors as well.

It is a fact that for a large utility distributor such as Meralco to effectively continue its operation in line with its objective of providing consumers best electricity service, it needs a robust domestic capitalization.

According to a report released by Oxfam Pilipinas, around 2.4 million households or 11 million Filipinos need efficient and sufficient supply of electricity.

Outside of its franchise area, several provinces in the South are petitioning to allow Meralco to provide them of reliable and cost-effective electricity supply, instead of relying on existing electricity cooperatives' inefficient services.

LKI is aware that Meralco's franchise renewal is up at stake next year as expiration of its franchise draws near. We believe this is the main reason why negative and unwarranted news are currently circulating, a desperate move to block Meralco from continually provide consumers efficient electricity supply with the lowest power rates in the country.

Meralco's rates are fair and transparent, according to the 2022 updated report published by the International Energy Consultants (IEC) on the Regional/Global Comparison of Retail Electricity Tariffs.

The IEC report assessed Meralco's reasonableness of various components including taxes, as well as generation and distribution charges. Based on these factors, IEC concluded that on average, Meralco's regulated customers are currently paying a fair and reasonable price for electricity.

We support IEC's recommendation that for Meralco to hold or improve its position relative to tariffs in other markets in the region, regulators and legislators must focus on facilitating investment in new power generation to meet rapid demand growth.

-Jorge Bandola, LKI Trustee