DOE wants more equitable distribution of vital grants

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Department of Energy (DOE) and Energy Regulatory Commission (ERC) seek comments from industry stakeholders on draft circular that aims to expand and improve implementation of the vital tariff in order to achieve a more equitable distribution of the vital subsidy.

A vital tariff is a subsidized tariff for marginalized or low-income end users who consume electricity below a threshold determined by the ERC. The cost is passed on to consumers who do not play a vital role.

Under the proposed requirements, the public distribution service (DU) must file an application for its proposed new survival tariff, which will be guided by the level of consumption that will be imposed by the ERC.

For the initial implementation of the proposed rules, DUs must continue to implement the existing approved rate and level of consumption until a new set is approved by the ERC.

“The price, as well as the level of consumption, will be per DU. They have to apply, ”said ERC Commissioner Floresinda G. Baldo-Digal, asked for comment.

For its part, the Manila Electric Co. (Meralco) said the industry will wait and be guided by the rules of law enforcement.

“DUs will have to wait for the final rules, in case they provide parameters that will guide any proposal to be submitted,” said Lawrence S. Fernandez, director of Meralco Utility Economics.

The lifeline tariff subsidy paid by non-lifeline consumers in the Meralco franchise is P 0.0478 per kilowatt hour (kWh).

DUs must submit an annual report on the implementation of the vital grant which will include, among other things, the number of marginalized end users.

To be considered for the granting of the Vital Discount, the applicant must be a qualified beneficiary household under Republic Law 11310, otherwise known as the “Pantawid Pamilyang Pilipino” or 4Ps program. The applicant must also live below the poverty line established by the Philippine Statistics Authority.

Apart from these, the average monthly consumption recorded in kilowatt hours of the applicant during the last 12 months is equal to or lower than the level of vital consumption approved by the ERC.

Previously, the Bicameral Conference Committee had approved a measure to extend the lifeline rate subsidy for an additional 30 years or until 2051.


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