Napocor behind price manipulations at WESM

From Neal Cruz. Kaya pala ang taas taas ng bill namin kahit na hindi na kami masyadong gumagamit ng kuryente.

Expect more increases in electricity bills cost. Money Quote:

Look at what happened in June 2006, the month the WESM first became operational. Apparently to please the President on the beneficial effects of the WESM, rates were lowered. As a result, electricity prices went down.

But unknown to the President and the public, the rate reduction looked good at first glance, but we know now that the Filipino people are paying for it. Since the rates were lowered, Napocor sold way below its regulated price. Data show that the WESM load weighted average price from June 26 to July 25, 2006 stood at P2.788/kWh. This is 38.5 percent lower than Napocor’s regulated rate of P4.5303/kWh.

Selling at much lower rates, Napocor lost P1 billion in its first month of operation. So it increased its selling price to recover its losses. This resulted in a sharp rise in electric bills for everyone. In the succeeding months, the average price of power rose nearly by 250 percent. In June, the first trading month, biddings resulted in an average price of P2.72/kWh. In the second month, it began to go up until it reached P4.853/kWh in the third month. The amount is expected to hit P6.88/kWh in the next few days.