Under Section 43(f) of Republic Act No. 9136, otherwise known as the Electric Power Industry Reform Act of 2001 (EPIRA), and Rule 15, Section 5(a) of its implementing Rules and Regulations (IRR),authorized the Energy Regulatory Commission (ERC) to adopt alternative forms of internationally accepted rate-setting methodology. Now therefore emerge Performance Based Regulation (PBR) which serves as a rate setting methodology using a price cap to set the distribution wheeling rates to be charged by Distribution Utilities to its customers. Due to such law, on December 13, 2006, ERC Approved Resolution No. 54 Series of 2006 “Adopting the Rules for Setting Distribution Wheeling Rates (RDWR) for Privately Owned Distribution Utilities Entering Performance Based Regulation for the Second and Later Entry groups as MERALCO, CEPALCO and Dagupan Electric were the first.

Then ERC issued Resolution No. 10, Series of 2010, adopting the timeline for the Fourth Entry Group of Regulated Entities entering the PBR commencing on October 01, 2011 and terminating on September 30, 2015. The 4 th Entrants are the following: Angeles Electric Corporation; Bohol Light Company Inc.; Clark Electric Distribution Corporation; Panay Electric Company; Subic Enerzone Corporation; San Fernando Electric Light & Power Company Last September 28, 2010, BLCI filed an application for approval of Annual Revenue Requirement (ARR) and Performance Incentive Scheme (PIS) with ERC under PBR regime. Then last November 23, 2010 a Jurisdictional hearing, expository presentation, pre-trial conference and evidentiary hearings regarding the ARR and PIS Application of BLCI was made here at the franchise area held in Governor’s Mansion, Tagbilaran City

On June 08, 2011 a Public consultation was made by the Energy Regulatory Commission on the Draft Determination of BLCI’s ARR and PIS Application While on May 21, 2011 the Draft Determination of BLCI’s ARR and PIS Application was posted on the ERC Web Site for further comments. Finally, last July 06, 2011 the ERC in its Decision and Final Determination approved BLCI’s ARR and PIS Application presenting its final decision on the price control arrangements that will apply to BLCI for the Regulatory Period with the smoothened Maximum Average Price (MAP) of P1.02 from 0.82¢ or an average increase of 0.20¢. The approved MAP will then be translated into rates for the different customer segment of BLCI such as Residential, Commercial, Public Buildings & Street Lights and Hospitals & Radio Stations. The translation of the approved MAP into rate by customer segment is still under application by BLCI with the ERC. In comparison to other Private Distribution utilities in the Visayas who were now using the approved Annual Revenue Requirement (ARR), among PECO, PROSIELCO, VECO, MECO and BLCI,

it appears that BLCI has the lowest rate for residential and commercial rate, like for example, on residential customer class, the following rates are as follows, P 10.89/kWh, P10.78/kWh P 9.19/kWh, P 8.15/kWh and P 5.98/kWh respectively even after with the proposed increased on the approved ARR for BCLI. For the Commercial Customer Class the rates for PECO, PROSIELCO, VECO, MECO and BLCI are P10.34/kWh, P12.39/kWh P 8.89/kWh, P7.80/kWh and 5.68/kWh accordingly. To simulate, estimated monthly billing comparison for residential using the old rate and the proposed new rate, if you have a consumption of 100kW your old bill is P644.49 while under the proposed new rate it would now be P671.03 with a difference of P 26.54 supposed increase per month which is still even lower than our average every day mobile load. While if you have an estimated consumption of 500kW, your old bill is P 3,127.13, and for the proposed new rate your bill would now be P 3,186.99 with difference of P 59.86/month which is still even affordable than your leisure drink session. This proposed rate increase was made to improve BLCI services and truly are for the benefit of the entire valued customer in the franchise area.