Rate Components
Pursuant to Section 36 of R.A. 9136 - the Electric Power Industry Reform Act of 2001 (EPIRA), all electric power industry participants were mandated to functionally and structurally unbundled their business activities and power rates in accordance with the provisions of the EPIRA Law.
The unbundling of rates was meant to enable the consumers to understand how much of their payment goes to each particular service.
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GENERATION CHARGE refers to the cost of power generated and sold to BENECO by the National Power Corporation (NPC) as well as other Independent Power Producers (IPPs) and other suppliers like Mirant, Hedcor and Luelco.
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TRANSMISSION CHARGE refers to the regulated cost of charges for the use of the transmission system for the delivery of power to BENECO paid to the National Transmission Corporation (TransCo).
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DISTRIBUTION CHARGE is the regulated cost of building, operating, and maintaining the distribution system that brings electricity to all consumers from the transmission system. |
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METERING CHARGE is the cost of metering, reading, operation and maintenance of metering facilities. |
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SUPPLY CHARGE includes the cost of rendering service to customers such as billing, collection, customer assistance and related services. |
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SYSTEM LOSS CHARGE represents the recovery of the cost of power due to technical and non-technical losses whose cap is currently pegged at 14% by the Energy Regulatory Commission (ERC) for electric cooperatives like BENECO.
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UNIVERSAL CHARGE refers to the charges imposed for the recovery of stranded debts, stranded contract post of NPC and other mandated purposes. It is non-by passable charge, which shall be passed on and collected from all end-users on a monthly basis by the distribution utilities. Payments collected by BENECO are remitted to the Power Sector Assets and Liabilities Management Corporation (PSALM) every month. |
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VALUE ADDED TAX is a consumption tax imposed on the sale of goods and services in the ordinary course of the business. The VAT on power refers to the national tax levied and assessed on the sale of electricity by generation, transmission, and distribution companies as provided for under Section 108 of Republic Act No. 9337, the Reformed Value-Added Tax Law. The rate of tax effective February 1, 2006 is twelve percent (12%). |
