ERC orders Davao Light to refund P96.2-M to customers

Nov. 21, 2014

DAVAO CITY—The Energy Regulatory Commission ordered the Davao Light and Power Company (DLPC), an Aboitiz-owned power distribution firm, to refund P96,209,557.96 to its customers for excess collection billed to customers from February 2004 and December 2012.

In its August 18 decision, the ERC said that Davao Light has “over-recovered” P437.835 million and under-recovered P341.625 million.

Specifically, ERC ruled that Davao Light should refund the following to customers:  system loss cost overrecovery of P370,710,197.57 and lifeline subsidy overrecovery of P67,125,352.76 which is equivalent to P0.0082/kWh (kilowatt hour).

But ERC said it authorized Davao Light to collect generation cost underrecovery of P264,885,529.24, equivalent to PO.0155/kWh and transmission cost underrecovery of P48,892,174.94 and inter-class cross subsidy underrecovery of P27,848,288.19, equivalent to PO.0089/kWh.

The ERC said the system lost cost and transmission cost vary on the type of customer class.

“Over or underrecoveries result due to the timing difference between the amount collected from customers versus the actual costs billed by the distribution utility’s suppliers,” said the Davao Light in an emailed statement to DavaoToday Thursday.

While it indicated that it would implement the refund, the Davao Light clarified that they collected the rates “in compliance” with the approved rates by the ERC during those periods.

According to DLPC, the said refund order “is in compliance to Energy Regulatory Commission (ERC) Resolution No.16, Series of 2009 and Resolution No.21, Series of 2010 after Davao Light and Power Co. filed its application for the approval of its (over)/under recoveries on pass through charges”.

Davao LIght said the refund “is estimated to be for a period of 4.5 years. The net refund for the first three years of implementation will be an average of P0.0285 kWh per month.

“This translates to P5.70 per month for a customer consuming 200 kWh a month. On the fourth year, the net average refund will be P0.0328 / kWh per month, which is equivalent to P6.56 per month for customer with the same electricity usage”.

It added that the “recoverable amount will be collected over a period of nine years and the implementation of the refund/recovery will start on December 2014.” (

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