(UPDATE) ELECTRICITY rates are expected to increase again as the Energy Regulatory Commission (ERC) announced on Tuesday that it has allowed the National Grid Corp. of the Philippines (NGCP) to collect an additional P28.29 billion from consumers.

This move was made after the completion of the ERC's deliberations regarding the 4th Regulatory Period Rate Reset of the NGCP, covering the years 2016 to 2022.

During its regular commission meeting held on March 26, the ERC, in a decision by the majority, composed of Commissioners Alexis Lumbatan, Floresinda Baldo-Digal and Marko Romeo Fuentes, resolved to adopt the maximum allowable revenue (MAR) of P335.78 billion for NGCP from 2016 to 2022, using the "As Spent" approach and adopting a weighted average cost of capital of 11.33 percent.

Following this decision and pursuant to a resolution adopted by the majority during the ERC's special commission meeting held on April 11, the regulator declared that NGCP will be entitled to recover an additional P28.29 billion in under-recoveries, which leads to an increase in transmission charges by the NGCP.

The commission's majority further resolved to set a seven-year recovery period for this collection, which on average translates to an additional P0.1013 per kilowatt-hour (kWh) per month in transmission charges that will be collected over the given period from issuance of the decision.

It added that this amount covers the P0.0629 per kWh average increase in the basic transmission charge and additional P0.0384 per kWh corresponding to the under-recovered portion of the increased MAR.

The commission also resolved to make permanent the NGCP's MAR for 2015 in the amount of P43 million.

NGCP's claim for a Net Performance Incentive Scheme reward for 2014, amounting to P783.06 million, was also approved.

The ERC said that its chairman and CEO Monalisa Dimalanta, and Commissioner Catherine Maceda dissented from the resolutions adopted by the majority.

It added that the official decisions, as well as the dissenting opinions of Dimalanta and Maceda, will be issued in due course.

In September 2022, the ERC issued Resolution 08, Series of 2022, which established the Amended Rules for Setting of Transmission Wheeling Rates that set forth the methodology for setting maximum transmission wheeling rates that the transmission sector may charge, including for the 4th Regulatory Period and the processes that will govern the subsequent regulatory periods.

To expedite the reset process, the ERC adopted a phased-in approach, starting with Phase 1 (covering January 2016-December 2020), which was included in the draft Partial Initial Determination published in September 2023.

After considering feedback from NGCP and interveners, the ERC said it prepared the draft Final Determination, which covered both Phase 1 and Phase 2 periods of the 4th Regulatory Period.

The commission said it then sought comments from energy stakeholders and the public on the draft Final Determination in November 2024.