source: https://www.sunstar.com.ph/davao/consumer-group-seeks-transparency-from-davao-light-over-rate-hikes

DAVAO CITY – A local consumer rights group is calling for greater transparency from the Aboitiz-owned Davao Light and Power Company (Davao Light) following a series of unexplained increases in electricity rates that have strained household budgets across the region.

The push for clarity comes after consumers noticed a significant jump in their bills, particularly the generation charge, which is the cost of producing electricity that Davao Light passes on from power suppliers.

In a formal statement, the Davao Consumer Movement (DCM) called MAP Mindanao alliance for Progress highlighted the lack of clear communication from the utility giant. “While we understand that Davao Light is a pass-through entity for generation costs, the recent hikes have been substantial and lack detailed public explanation,” a MAP / DCM representative stated. “Consumers deserve to know exactly what they are paying for. Which power plants are causing these increases? Is this due to higher fuel prices? We need more than just a line item on our bill.”

Data from Davao Light itself shows a noticeable upward trend. The overall rate rose from P10.3191 per kilowatt-hour (kWh) in January to P10.8791 per kWh by May 2024. The most critical component, the generation charge, increased from P6.1173 per kWh to P6.4956 per kWh in the same period.

While Davao Light attributes these hikes to higher charges from the Wholesale Electricity Spot Market (WESM), where it purchases power during supply shortfalls, consumer advocates argue this explanation is insufficient.

“The WESM is often the scapegoat for rate increases, but the public needs to understand why Davao Light is relying on it more heavily,” the DCM added. “Is there an issue with their contracted power supply? Are there plant outages we aren’t being informed about? Transparency is key to building trust.”

In response to SunStar’s inquiry, Davao Light Communications Manager Ross Luga explained that the May rate increase was primarily due to a 38-centavo rise in the generation charge, driven by a P1.84 per kWh spike in WESM prices. Luga cited lower hydroelectric power production and higher demand during the summer months as contributing factors.

However, the consumer group insists that such explanations should be proactively and clearly communicated to all customers, not just upon request. They are urging Davao Light to implement more robust consumer information campaigns detailing the reasons behind monthly fluctuations.

The call for transparency puts the spotlight on the delicate balance between utility operations and consumer protection. As electricity is an essential service, advocates argue that Davao Light has a responsibility to ensure its customers are fully informed, especially when their financial burden increases.