Republic of the Philippines

ENERGY REGULATORY COMMISSION

A world class and independent electric power industry regulator that equitably promotes and protects the interests of consumers and other stakeholders, to enable the delivery of long-term benefits that contribute to sustained economic growth and an improved quality of life.


Case Filing Procedures - Applications for a General Change in Rate Schedules or Revision of Rates

A. Applications for a General Change in Rate Schedules or Revision of Rates

Section 1. Applications for a General Change in Rate Schedules or Revision of Rates. - Applications for a general change in rate schedules shall indicate the revised rates applied for and the reasons cited to justify such revision or adjustment. Rate applications of distribution utilities that are not yet under performance-based regulation shall conform to the appropriate form in the attached ERC Standard Forms.

Section 2. Supporting Documents and Information. - The application for a general change in rate schedules shall be accompanied by the following documents and information:

(a) Schedule A (in ERC Format)

Table 1: Development of Rate BaseSpecific Requirements: For Electric Cooperatives (EC) and Private Utilities (PU)

1.1. Appraisal Report

1.1.1. Independent appraiser should be accredited by ERC

1.1.2. Appraisal Report must be in accordance with the Guidelines for the Appraisal of Property, Plant and Equipment for Rate Fixing Purposes of ERC

1.1.3 Two (2) copies of Valuation Report of Independent Appraisal Company

1.2. Detailed Breakdown of assets, additions and retirements after the last approved application up to the present appraisal

1.3. Schedule showing the percentage of local and foreign cost component of assets under appraisal

1.4. Schedule of rate of depreciation and method used per asset category

1.5. Schedule of utility plant in service for the test year (both depreciable and non-depreciable assets)

1.5.1. Schedule: Comparison of Utility Plant in Service (Test Year vs. Previous Year) Assets with more than 100% increase from previous years need detailed breakdown with corresponding justification

1.6. Schedule of depreciation expense on Appraisal Increase (from last approved appraisal)

1.6.1. Schedule of depreciation rate

1.7. Schedule of Construction Work-In-Progress (Status and Percentage of Completion)

1.8. Determination of Cash Working Capital (computation, billing cycle, supporting documents)

1.9. Schedule of Assets previously disallowed by ERB/ERC indicating order/decision date, if any

Table 2: Capital Costs

Specific Requirements: For PUs only

2.1. Copy of the Approved Capital Expenditure (CAPEX) Project/s or the application in the absence of approved CAPEX Project/s for the Test Year

2.2. Projected Statement of Invested Capital and Rate of Return for a Five (5) Year Period

2.3. Schedule of Invested Capital and Rate of Return (for the Test Year period)

2.4. Schedule of Annual Debt Cost Calculation for the Test Year

Specific Requirements: For ECs only

2.1. National Electrification Administration (NEA) Loan Profile for the Test Year

2.2. Loan Profiles from sources other than NEA for the Test Year (Include loan profiles for the succeeding year(s) if new loans were acquired after the test year)

2.3. Detailed Breakdown of the amount of Debt Service reflected in the current rate application (Uniform Filing Requirements / UFR)

2.4. Written explanation reconciling the differences in total amount of Debt Service (UFR) (excluding Interest Cost on Cash Working Capital) vs. the Test Year’s Loan Profile/s (NEA and other sources)

2.5. Copy of the Approved Capital Expenditure (CAPEX) Project/s or the application in the absence of approved CAPEX Project/s for the Test Year

Table 3: Operation & Maintenance ExpenseSpecific Requirements: For ECs and PUs

3.1. Power Cost3.1.1. Generation Cost Schedule for the Test Year

3.1.2. Transmission Cost Schedule for the Test Year3.1.3. System Loss Schedule for the Test Year

3.1.4. Written explanation reconciling the differences in the amount reflected in the Generation & Transmission & System Loss Schedules vs. rate application (UFR)

3.1.5. Sources of Poweri. NPC (Main or Small Power Utilities Group / SPUG), pls. specify)ii. Independent Power Producers (IPP)iii. Self-generationiv. Others (ex. Other Distribution Utilities / DUs)

3.1.6. Certified True Copies of Power Bills used in the Test Year3.2. Explanation on any discrepancy of the amount reflected in the rate application vs. Audited Financial Statement (F/S)

3.3. Detailed Breakdown of all Expenses/Accounts - with explanation as to the purpose of expenses (both in hard and electronic copies)

3.4. NEA Cash Approved Budgets for the Test Year (For ECs)

3.5. Top Twenty (20) Uncollectible Accounts (Acct. Code No. 420-904)3.6. Copies of publications/fliers made for Informational and Instructional Advertising Expenses for the year 2003 and corresponding costs thereon. (Acct. No. 420-905-00)

Table 4: Payroll Portion of O & M

Specific Requirements: For ECs and PUs

4.1. Plantilla/Payroll (per employee, latest monthly) basic salary, SSS, Pag-ibig, PhilHealth, 13th month pay & other benefits for the Test Year (Use Table 1)

4.2. For the 2 years prior the Test Year, Test Year and the Year after:

4.2.1. Total number of plantilla (permanent) positions

4.2.3. Number of positions filled-up

4.2.4. Number of vacant positions

4.2.5. Number of contractual employees

4.2.6. Number of casual employees

4.3. Written explanation reconciling the difference in the Plantilla/Payroll vs. the Payroll Cost reflected in the rate application (if any)

4.4. Certified photocopies of the following issuances: 2003 to presentSpecific Requirements: For ECs only

4.5. Wage orders issued affecting the EC’s salaries & wages

4.6. Copy of NEA approval on each of the incentives/ benefits granted by the cooperative to its officers and employees (Refer to Table 2)

4.7. If applicable, copies of the EC Board Resolution on the incentives/benefits granted to officers and employees

4.8. If applicable, copies of the Collective Bargaining Agreement (CBA) on increase in salaries or grant of incentives or benefits

4.9. Details of Pension & Benefits (Acct. No. 430-926-00)4.10. Officers’ Allowances & Benefits (Acct. No. 433-934-00)

Table 5: Depreciation and Amortization Expense

Table 6: Income Tax & Other Items

 

(b) Work Papers on Details & Explanations

1. Audited F/S (Audited F/S of test year)

2. Balance Sheet

3. Income Statement

4. Cash Flow

5. Notes to the Financial Statement

6. Trial Balance

7. Work Papers

7.1. To explain functionalization of each account and its basis

7.2. To explain calculation of electricity-related amounts/ adjustments transferred to column 4 of Schedule A

7.3. To allocate electricity-related amounts in column 5 of Schedule A among the five functions in cols. 6-108. Projected Financial Statements for Five (5) Year Period9. Projected Cash Flow Statements for Five (5) Year Period

(c) Schedule A-1: Summary of Revenue

1. Sources for all Distribution/Transmission

2. Related Business

(d) Schedule B in ERC Format: Summary of Cost of Service (CoS) using Revalued Assets/ Projected Values (For PUs only)

(e) Schedule C: Cost of Capital

Specific Requirements: For ECs only 

1. Calculation/Methodology/Debt Service Details

2. Detailed summary of all components of total EC debt service

3. All supporting documentation including any reports submitted to NEA or Power Sector Assets and Liabilities Management Corporation (PSALM)

(f) Schedule D: Functionalization Factors

1. Detailed computation/explanation of any deviation/modification made on default factors of the UFR Model 

2. Method used in the Demand-Customer Split Minimum Plant Method

2.1. Summary of Meters (latest data)

2.1.1. Type, Quantity and Amount

2.1.2. Number and Cost (disposed and under repair)

2.2. Summary of Transformers (latest data)

2.2.1. Type, Quantity and Amount

2.2.2. Number and Cost (disposed and under repair)

2.3. Summary of Poles (latest data)

2.3.1 Type, Quantity and Amount

2.3.2. Number and Cost (disposed)

3. Narrative description of the functionalization factor if code designation is used

4. The relative (decimal representations of percentages) amounts constituting the functionalization factors

5. The absolute amounts constituting the factors, i.e. the data used as numerators and divisors in calculating the functionalization factors

 

(g) Schedule E: Billing Determinants & Customer Class Allocation

1. Sub-Schedule E-1: System DataSpecific Requirements For ECs and PUs

1.1. Basis of kWh Sales

1.1.1. Actual

1.1.2. Average

1.1.3. Annualizedi. Increase or decrease in kWh sales due to adjustment for changes in customer composition and/or for changes in the number of customersii. Increase or decrease in kWh sales due to adjustment other than for the effects of customers(e.g. reclassification of customers), reflecting each adjustment separately

1.2. Basis of kW Demand 

1.2.1. Annual Billing Demand (kW) for the test year for customer classes with demand meters meaning, all customers of that particular class should have demand meters

1.3. Basis of Number of Customer

1.3.1. Average number of customers1.3.2. Year-end number of customers

1.4 System Load Factor

1.5. Schedule of Power Interruptions for Five (5) Year Period

1.6. Narrative explanation for all adjustments made for the Year of the above schedule

1.7. Frequency Distribution of Customers and kWh consumption of Residential Customers (Test Year and Current Year)

2. Sub-Schedule E-2: Customer Adjustments

Specific Requirements: For ECs and PUs

2.1. Does the DU have the following customer classes:

2.1.1. Sale for Resale? If yes:- Identify the customer/s- Provide copy of the contract- When did the sale started?- What is the rate/kWh charged to his customer?- To date, does the DU still have this type of customer?

2.1.2. “Others”? If yes:- Identify the customer/s and give brief description of customer class (e.g. - Temporary Lightings during fiestas)- What is the rate/kWh charged to this customer?- To date, does the DU still have this type of customer?

2.1.3. Large Load? If yes:- Identify the customer/s- Provide copy of the contract- When did the sale start?- What is the rate/kWh charged to his customer?- To date, does the DU still have this type of customer?- From what voltage level does this customer take power?- What is the product line of this customer?- Is it considered in the computation of the Total Revenue Requirement? If not, submit schedule showing the cost of servicing and revenue derived from the same.- Provide same schedule for other customers under the same scenario

2.1.4. Streetlights?- How does the DU bill this type of customers(Per number of bulbs/per street/per barangay/per municipality?)- Are they metered?

2.1.5. List of Barangay Power Association (BAPA) (For ECs only)- Indicate number of mother meters and individual house connections per BAPA and corresponding kWh Sales- Identify the customer/s and give brief description of customer class (e.g. Temporary Lightings during fiestas)- What is the rate/kWh charged to the customer?- How does the DU bill this type of customers (Per number of bulbs/per street/per barangay/per municipality?)

3. Sub-Schedule E-3: Rate of ReturnSpecific Requirements: For PUs only

3.1. Determination of Return on Rate Base/Weighted Average Cost of Capital (WACC) (study and supporting documents)

4. Sub-Schedule E-4: Class CoS Analysis

5. Sub-Schedule E-5: Class Allocation Factors for

5.1. Generation

5.2. Transmission

5.3. Distribution

5.4. Supply

5.5. Metering

(h) Schedule F: Rate Design

1. Sub-Schedule F-1: Revenue Summary

2. Sub-Schedule F-3: Rate Class Definition

3. Sub-Schedule F-4: Load Research Data

Specific Requirements: For ECs and Pus

3.1. Sub-Schedule F-4.1: Basis of System Peak Demand

3.2. Sub-Schedule F-4.1.1: Total system peak demand and peak demand by rate and by class for the Test Year and for each month of the Test Year

3.3. Sub-Schedule F-4.1.2: Detailed computation of Coincident and Non- Coincident Peak per customer class for the Test Year 

4. Sub-Schedule F-5: Justification for Consumption Level-Based Rates

5. Sub-Schedule F-6: Proof of Revenue Statement5.1. Sub-Schedule F-6.1: Comparison of Revenue and Rate (Existing vs. Proposed)

6. Sub-Schedule F-7: Rate Design Analysis Data

6.1. Sub-Schedule F-7.1: Customer Profile and Rate Impact Simulation per customer class

 

(i) Schedule H 

1. Sub-Schedule H-1: Computation of Inter-Class Cross Subsidy

2. Sub-Schedule H-2: Proof of Revenue Statement

3. Sub-Schedule H-3: Computation of Lifeline RateSpecific Requirements: For ECs and PUs

3.1. Sub-Schedule H.3.1: Detailed Breakdown of Lifeline Discount granted and collection of subsidy

3.2. Sub-Schedule H.3.2: Frequency Distribution of Customers and kWh consumption of Residential Customers (Test Year and Current Year)

 

(j) Schedule J: System Losses & Associated Costs

Specific Requirements: For ECs and PUs

1. Proposed cap on the recoverable rate of system losses based on load density, sales mix, cost of service, delivery voltage, and any other relevant technical parameters. The supporting data and analysis shall distinguish between technical and non-technical system losses and differentiate losses based on customer class.

2. Detailed system loss information for the past five (5) years and any applicable engineering studies

3. Calculations of all costs directly attributed to system losses

4. Calculations of the rate components for the recovery of costs associated with system losses in a fashion separate and distinct from other rates; and

5. Plan to reduce system losses over the next five (5) years which shall include costs and/or investments to attain such deduction

 

(k) Schedule K: Rate Schedules for Each Customer

(l) Schedule L: Non-Recurring Rates & Supporting Cost Data

 


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