Senator Risa Hontiveros on Tuesday, July 11 said the power rate reduction that the Manila Electric Co. (Meralco) announced for the month of July is only minimal and temporary. The senator pointed out the decrease in electricity charges is bound to happen considering that the price of imported coal has also decreased in the world market. “So the question is, how long can consumers enjoy lower electricity bills? It is not permanent (Kaya ang tanong, hanggang kailan matatamasa ng konsyumer ang mas mababang singil sa kuryente? Hindi ito permanente),” Hontiveros said. “The government should proactively implement policy changes that would permanently and sustainably reduce our consumers’ electricity bills,” she added. Meralco earlier announced a P0.72/kWh decrease in rates for the month of July, purportedly as a result of the lower generation rate it receives from the Wholesale Electricity Spot Market (WESM) and its contracts with coal plants. However, power costs, Hontiveros stressed could potentially be reduced further if the government considers implementing vital policy changes in the energy sector. Aside from the generation charge, she said there are other items in the electricity bill that can be further reduced and have a long-term effect such as the distribution charge billed by Meralco, and the transmission charged of the National Grid Corp. of the Philippines (NGCP). “One reform that I have been insisting on for a long time in the Energy Regulatory Commission (ERC) is the lowering of the very high 15% weighted average cost of capital (WACC) (Isang reporma na matagal ko nang iginigiit ERC ay ang pagpapababa sa napakataas na 15% WACC),” the lawmaker said. “Meralco and NGCP have benefited from this since 2015. If this can be corrected, there will definitely be a reduction in distribution and transmission charges and the burden on consumers will be eased (Mula pa 2015 ito pinakikinabangan ng Meralco at NGCP. Kung maitatama ito, tiyak na may bawas din sa distribution at transmission charges at mapapagaan ang pasanin ng mga konsyumer),” she said. Meralco's distribution charge last June was around 18 percent of the total bill, transmission charge was four (4) percent, while government taxes were 10 percent. More than half of the bill, or 59 percent, is therefore payable to generation. At the same time, she urged the ERC and the Department of Energy (DOE) to also correct and monitor power supply agreements (PSAs) between generation companies and distribution utilities, as well as optimize and adjust system operations. Fraudulent contracts, power shortages, and delayed transmission projects directly affect consumers, Hontiveros pointed out. Likewise, plans to also impose value added tax (VAT) on already costly power rates could further strain Filipino families’ finances, she warned. The senator said she hopes the President Ferdinand “Bongbong” Marcos Jr. would prioritize resetting the improper practices in the power sector and address the issue during his second State of the Nation Address (SONA) on July 24.