CA orders Meralco to refund P5B to customers

MANILA, Philippines – The Court of Appeals (CA) has ordered the Manila Electric Company (Meralco) to refund its customers about P5 billion ($111.80 million*) that the utility firm will recover from the National Power Corporation (NPC) and the Power Sector Assets and Liabilities Management Corporation (PSALM).

In a 20-page decision, the CA’s Special Second Division enjoined Meralco to comply with the Energy Regulatory Commission (ERC) order that directs it to refund its customers through automatic deduction of the refund amount “to computed monthly generation rate for the amount it will recover from NPC/PSALM.”

“In truth, it is the public that has been doubly charged,” the appeals court said.

Both NPC and PSALM were ordered to refund Meralco a total of P5,176,147,098.73 ($115,738,513.28) from the November 2006 to August 2012 period.

Meralco will be receiving P73,944,958.55 ($1,653,501.81) monthly or its equivalent until the over-recoveries are fully refunded.

In June 2006, when the Wholesale Electricity Spot Market (WESM) started its commercial operations, new systems and protocols were introduced including the allocations for transmission line losses.

But since the NPC-Time of Use (TOU) was not revised, Meralco continued to pay transmission line losses to both NPC and WESM.

The CA, it its ruling dated March 10, 2010, affirmed the ERC order to refund, and such order was deemed final.

“The doctrine of finality of judgment is grounded on fundamental considerations of public policy and sound practice,” the appeals court said, quoting a Supreme Court decision.

 “When a decision has attained finality, it can no longer be revisited even if the modification is meant to correct what is perceived to be an erroneous conclusion,” the CA said. – Rappler.com

$1 = P44.72