As expected, the Energy Regulatory Commission (ERC) rejected the joint petition of San Miguel Corp. and Meralco for a rate hike to cover losses incurred by San Miguel's power generation subsidiaries due to the sudden spike in energy prices from 2021 onward.
But Biz Buzz learned that the decision of the regulator wasn't unanimous. In fact, it was a close 3-2 vote in favor of dismissing the petition.
The two dissenting ERC commissioners—Alexis Lumbatan and Marko Romeo Fuentes—noted that, under the San Miguel-Meralco petition, Meralco customers would have to pay an additional P5.2 billion over a six-month recovery period.
Under scenario two, where ERC rejects the petition, and San Miguel withdraws from its power supply agreement, leaving Meralco to secure a one-year emergency supply deal, Meralco consumers will have to pay an additional P12.6 billion for electricity. A similar scenario where the power will be sourced through a competitive selection process will result in an additional burden of P25.8 billion for Meralco customers.
Finally, a third scenario that has Meralco sourcing power from the electricity spot market will burden consumers with P1.6 billion … every single month (the most expensive option).
The two dissenting commissioners pointed to an internal simulation done by the ERC's Regulatory Operations Service (ROS) to determine "which available option best serves and protects the consumers."
"The ROS in its response, through Engr. Alvin Jones Ortega (Chief of the Tariffs and Rates Division), confirms that granting the price adjustment remains to be the cheapest option," the dissenting ERC commissioners said.
Unfortunately, they were outvoted. So that's that. Higher electricity prices are coming, it seems, not despite but because of the ERC's decision.
—Daxim L. Lucas
PH's best banks
Ayala-led Bank of the Philippine Islands (BPI) is the "best domestic bank" in the Philippines for 2022, and likewise the best bank for corporate social responsibility for this year, according to Asiamoney.
"Even when the economy was hit by the pandemic and the impact of higher inflation in 2021, the team run by president and chief executive Jose Teodoro Limcaoco managed to increase BPI's market share in banking system deposits, loans and assets under management," Asiamoney said.
"BPI's cross-border remittances business is hard for peers to match, as is the bank's footprint across bancassurance, asset finance and leasing," it added.
Credit Suisse bagged the "best international bank" title this year.
"The team led by Philippines' country manager Mark Uy, along with Asia-Pacific vice chair Lito Camacho in Singapore, maintained its leading position in the international Philippine bond market in terms of both issuance volume and deal numbers," Asiamoney said.
"We are extremely grateful to our clients for their continued trust and confidence in us, especially in today's challenging market environment. We remain steadfast in our commitment to build lasting values with our Philippine clients by constantly delivering first-class services with utmost care and diligence, guided by our entrepreneurial spirit," Uy said.
Meanwhile, UBS was hailed as the country's "best investment bank."
Metropolitan Bank & Trust Co. got the "best corporate bank" citation, while BDO Unibank won "best bank for small and medium enterprises."
RCBC, on the other hand, was awarded as the "best bank for digital solutions, while UnionBank was honored as the "best bank for ESG (environment, social and governance)."
Asiamoney also cited Security Bank as the "best bank for diversity and inclusion."
Meeting the deadline
The Department of Transportation (DOTr) is keen on completing the much-awaited Metro Manila subway project by 2028. After all, this massive infrastructure undertaking was first proposed way back in 1973.
DOTr Undersecretary for Railways Cesar Chavez, on the sidelines of the groundbreaking ceremony for the subway's Contract Package (CP) 104, said they were targeting to award all the seven contracts for the project by the first quarter of next year to meet the 2028 deadline.
CP 104—which includes the construction of Ortigas and Shaw Boulevard stations—was awarded to Megawide Construction Corp., Tokyu Construction Co., Ltd. and Tobishima Corp. in May.
The groundbreaking ceremony on Monday marked the start of construction for Ortigas and Shaw Boulevard stations of the underground railway. Meralco Avenue in Ortigas, Pasig City, as such, is now closed until 2028 to make way for civil works.
Eric Gregor Tan, assistant vice president for business development at Megawide, said preparatory work for the project would likely last for three months at the most before actual construction begins.
"Preparatory works include clearing of the area, closure of the roads and putting up a fence, [among others]," he told the Inquirer. These also include the relocation of utilities and drainage, he pointed out.
The 33-kilometer underground railway system, which is designed to have 17 stations, will connect Valenzuela City to Pasay City.
The subway is expected to service over 519,000 passengers daily once operational.
In June, the first tunnel boring machine (TBM) for the project was lowered to begin the underground work. A total of 25 TBMs, which can drill up to 12 meters of tunnels per day, will be used for the project.
—Tyrone Jasper C. Piad INQ
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