DEBIT CREDIT

Part One

We are all victims of the “justice delayed is justice denied” syndrome. I am referring to the situation of our ever-increasing electric bills. I have assessed this and believe that most of us have been over-billed and hence, deserve a refund or rebate on these excess billings. These over billings have been occurring for several years now. Failure on the part of the government regulator to correct this injustice is further prolonging our right to recover the amounts due to us.

Let me explain.

For the past more than 10 years after the implementation of a new rate-setting methodology (the Performance Based Rate (PBR) methodology), the distribution rate billed by

Meralco and other privately owned distribution utilities (PDUs) to consumers did not change. This is in spite of the strong indications that there were over-recoveries or overbillings due to an error in calculat- ing the provisional or interim rates. Thus, consumers were held captive to an unusual cycle that benefits only the PDUs. It starts with the PDU filing an application with the Energy Regulatory Commission (ERC) for a maximum allowable rate (MAP). This MAP will be used to translate distribution rates by customer segment. The PDU may intentionally or unintentionally try to get approval for a much higher rate. Since the allowed rate by ERC is only provisional (subject to adjustment when final rates are determined), this creates an opportunity for the PDU to generate excess funds that will either be returned to the consumers as a refund, or retained by the PDU as a windfall profit—depending on how ERC finally determines the rate. So, in case of over-recoveries (intentionally or not), PDUs are greatly benefited from the accumulation of excess cash during the period when the rate is being finalized. This is like borrowing funds from tain that the multiple indictments could help Trump improve his standing in polls of Republican voters and solidify the impression that the government is conspiring against him.

Republican Rep. Nancy Mace of South Carolina told CNN she believes the indictment “handed Donald Trump the nomination” in the 2024 GOP primary.

And as the House panel has ramped up its efforts to defend the former president, the word “weaponization” has taken root among Trump’s Republican allies. Nearly every GOP lawmaker used the term as did a member of Trump’s legal consumers without authorization, collateral, interest, or repayment period. Even if the regulator decides for Meralco to refund the excess, the consumers may end up paying the refund to themselves if, during the refund period, the monthly bills also contain an over-recovery. If for any reason, the regulator finally decides there is a lower recovery or no over-recovery, the PDU generates a windfall profit. A case called Vicious Cycle.

Consumer protection can only be provided by the regulator and the auditors (internal and external). There are consumer advocate groups, but they are disadvantaged by a lack of information (critical information treated as confidential) and a lack of funds.

The regulator ERC is mandated by law to protect the interests of consumers. Sections 41 and 43 of the Electric Power Industry Reform Act (EPIRA) state the role of the ERC specifically in enforcing the implemen- team hours before the charges were unsealed to the public.

“It puts a stamp of reality on something that really is unreal in terms of the weaponization of the Department of Justice,” said James Trusty, one of Trump’s lawyers, on ABC Friday morning. Trump announced later in the day that Trusty was leaving his team.

Republican Sen. Ted Cruz of Texas tweeted that “the weaponization of our Department of Justice against enemies of the Biden admin. will do enormous damage to the rule of law & have a lasting impact.”

Cruz’s GOP colleagues in the Senate were more muted, with Re- tation of the rules and regulations of the Act and, establishing and enforcing a methodology for setting transmission and distribution wheeling rates and retail rates, among others.

A new rate-setting methodology was adopted after the implementation of EPIRA, called the PBR, from which the rules governing the setting of transmission and wheeling rates were promulgated. Under the PBR, forward-looking rates are set every five years for transmission and every four years for distribution.

The external auditors are principally involved in the statutory audit of and assessing the reporting of the financial statements of the PDUs. In this statutory audit, the auditors follow generally accepted accounting principles and reporting rules by the Securities and Exchange Commission. In addition, it is also required to follow a set of auditing guidelines or standards prescribed under the Philippine Standards on Auditing (PSA). More specifically, publican Leader Mitch McConnell and others who have criticized the former president declining to weigh in on the indictment. if the audit client is a regulated entity, the auditor is also mandated to follow one specific standard, PSA 250. This PSA deals with the auditor’s responsibility to consider laws and regulations or the legal and regulatory framework when performing the audit for the benefit of the public.

Republican Sen. Mitt Romney of Utah, the only GOP senator to vote to convict Trump in both of his impeachment trials, was a rare voice of criticism. While Romney stressed that Trump is entitled to presumption of innocence, he said he believes the charges are serious and Trump brought them on himself.

“These allegations are serious and if proven, would be consistent with his other actions offensive to the national interest,” Romney said.

Are the auditors complying with their mandate of ensuring that the PSA 250 is complied with by assessing the presentation of the financial operations of the PDUs? What is the impact on us electric consumers if there is a compliance failure on the part of the concerned entities?

To be continued.