Loopholes in electricity lifeline subsidies flagged as 'condos', 'rest houses' received discounts

Jessica Fenol, ABS-CBN News

Posted at Sep 01 2020 11:41 AM

Loopholes in electricity lifeline subsidies flagged as 'condos', 'rest houses' received discounts 1
People walk along a neighborhood with electric meters and wires hanging overhead in Manila. October 09, 2018. Jonathan Cellona, ABS-CBN News/File

MANILA - The lifeline rate for electric bills should be "targeted" to ensure that only the poor are given discounts after it was discovered that condominiums and rest houses were given subsidies even if consumption registered below 100 kWh, lawmakers said Tuesday.

The Senate Committees on Energy and Public Services are tackling Senate Bill 1583, seeking to extend the electricity discounts to the poorest households with consumption below 100 kWh.

Lifeline consumers are given discounts to provide "economic relief." On average, lifeline subsidies reach P1.6 billion annually, Senate Energy Committee chair Sherwin Gatchalian said.

However, based on his own computation which is subject to validation, at least 33 percent of households were given discounts in 2018 when the poverty incidence in the country is only at 12 percent, Gatchalian said.

Out of the P1.6 billion annual average electricity discounts, some P987 million in "leakages" went to non-marginalized consumers such as condominiums, Gatchalian said. 

Gatchalian showed 2 Meralco bills of unoccupied condominiums in Makati and in Tagaytay City, both were given discounts when obviously the owners were not poor.

"Condo units are getting subsidies and these are not marginalized end users, these are condominiums, some of them are rest houses or condominiums that are owned by well-off families and well-off consumers," Gatchalian said.

"So these are the loopholes and this is the gap that I see in this law. Even after 20 years of enactment, it seems to me that pinabayaan na lang natin ito at wala tayong ginawa (the government let it happen, we did not do anything)," he added. 

According to the Energy Regulatory Commission, the only basis in implementing the subsidy is the consumption level submitted by utility distributors. 

"It was on the assumption that based on your consumption, kung maliit ang consumption lalo na sa rural area, 'yun po ang kinokonsider na marginalized and would be extended a discount," ERC chief of Tariffs and Rates Division Alvin Ortega said. 

(The assumption is that if the consumption is low and in rural areas, that's considered marginalized)

Ortega assured the Senate that the agency would "address" the concerns raised during the hearing.

During the hearing, Department of Energy director Mario Marasigan expressed his support for the extension of the lifeline subsidy. 

However, an amendment to make the "mechanism for the accurate targeting of true beneficiaries" was proposed. Marasigan also said the level of consumption and the rate should be determined by the ERC.

Gatchalian said this was just one of the loopholes the new measure is seeking to address. 

Senator Risa Hontiveros, meanwhile, suggested that there should be a mechanism to ensure that poorest households supported by the government programs such as 4Ps should be included in the electricity lifeline program.