At least 2.6 million customers of Manila Electric Company (Meralco) will continue to receive discounts in their electric bills as mandated under Republic Act 11552 or the Extended Lifeline Rate Act.
According to Meralco Vice President Lawrence S. Fernandez, the total amount of rate discounts to qualified customers of the utility firm would range from P320 million or P3.84 billion annually.
Lifeline users in the power industry are those with consumption of 100 kilowatt hours (kWh) and below, who are mainly included in the list of the Pantawid Pamilyang Pilipino Program (4Ps) being administered by the Department of Social Welfare and Development.
RA 11552 has stretched the duration of the lifeline rate subsidy for a period of 50 years – that was from the passage of the Electric Power Industry Reform Act (EPIRA) in 2001; hence, qualified consumers would be able to enjoy this privilege for several decades more.
The "lifeline rate" is an "out-of-pocket subsidy" collected from the monthly electric bulls of consumers who are in the usage level of 101 kilowatt-hours and higher.
The determination of the subsidy rates to be extended to the qualified marginalized end-users had been vested as an authority to be exercised by the Energy Regulatory Commission (ERC), being the regulator of the restructured power industry.
In line with that mandate, the Commission worked with the DSWD for the ‘clean up’ of the lifeline users’ roll – and the main intent of that exercise was to purge from the list the residents from condominiums as well as those from gated villages.
The validation of qualified customer-beneficiaries shall also be done with the help of private distribution utilities (DUs) as well as electric cooperatives being in the front line of servicing the consumers.
In the initial implementation of lifeline rate subsidy under Section 73 of EPIRA, the tariff discounts ranged from 25 to 75-percent depending on the magnitude of power usage of the marginalized end-user or poor household customer – and the consumption range considered had been from zero to 100 kilowatt-hours.
Given the economic impact of expensive electricity rates, it was emphasized that the lifeline rate for the specified segment of consumers will not only alleviate the financial burden of these marginalized end-users, but it will also ease the country’s overall inflation rate.