Universal Charge
Administration of Universal Charge

Lighting the countryside: PSALM continues to significantly contribute to government efforts to provide a steady and reliable supply of electricity in the country's far-flung areas.

Communities in these areas get much-needed electric power through PSALM’s prudent management and disposal of the collections from the Universal Charge (UC) for Missionary Electrification (UC-ME).

A non-bypassable charge mandated under Section 34 of the EPIRA, the UC is imposed on electricity consumers for the following purposes:

  1. Missionary electrification;
  2. Payment for stranded debts and stranded contract costs;
  3. An environmental charge for watershed rehabilitation and management;
  4. Equalization of taxes and royalties applied to indigenous or renewable sources of energy vis-à-vis imported energy fuels; and
  5. A charge to account for all forms of cross-subsidies.

At present, only the UC-ME and the UC for Environment and Watershed Rehabilitation and Management (UC-EWRM) amounting to PhP0.0025 per kilowatt-hour are imposed on and are being collected from electricity consumers.

The UC is collected monthly by the National Grid Corporation of the Philippines and the distribution utilities based on the approval of the Energy Regulatory Commission (ERC). The collections are remitted to PSALM every 15th of the following month.

Universal Charge (UC) Administration

  1. Universal Charge Remittances, Interests and Disbursements
  2. As of 31 January 2018, remittances of collecting entities (CEs) to PSALM amounted to PhP140.173 billion, while interest earnings from deposits and placements of UC funds amounted to PhP0.156 billion. On the other hand, UC fund disbursement amounted to PhP138.670 billion. Below are the details of UC remittances, interests and disbursements:

    Universal Charge Remittances, Interests and Disbursements
    As of 31 January 2018 (In PhP Billion)

    Particulars Remittances Interests Disbursements Balance
    Special Trust Funds: Missionary Electrification (ME) - NPC SPUG 74.883 0.044 74.895 0.032
    ME - Renewable Energy Developer Cash Incentive (REDCI) 0.461 0.002 0.236 0.227
    Environmental Charge (EC) 2.039 0.101 1.491 0.649
    Stranded Contract Cost (SCC) 62.088 0.008 62.048 0.048
    Stranded Debts 0.702 0.001 0.000 0.703
    Total 140.173 0.156 138.670 1.659

    1Includes Disbursement to Oriental Mindoro Electric Cooperative, Inc. (ORMECO) in the total amount of PhP40,442,954.47, for the recovery of fuel costs chargeable against the UC-ME fund, pursuant to ERC Orders dated 16 June 2014 and 24 September 2014 covering ERC Case No. 2013-191RC

    The following disbursements/fund transfers were made from the respective UC Special Trust Fund (STF):

    1. UC-ME and EC

      • PhP74.895 billion and PhP1.491 billion were paid to NPC, chargeable against the UC-ME and EC fund, respectively, in accordance with the provisions of the EPIRA and the Energy Regulatory Commission (ERC) decisions/orders.
    2. UC-SCC

      • PhP62.048billion was transferred from the UC-SCC STF account to PSALM’s UC-SCC Special Fund Account (SFA), following the PSALM Board-approved Guidelines and Procedures on Disbursement and Utilization of UC-SCC of NPC.
    3. REDCI

      • Cash incentive totaling PhP0.236 billion was paid to the following renewable energy (RE) developers, in accordance with the ERC-approved Rules to Govern the Availment and Disbursement of Cash Incentive to RE Developers Operating in Missionary Areas:
        1. Romblon Electric Cooperative, Inc. (ROMELCO) for the 900 kW Cantingas Mini Hydro Power Plant Corporation (CHPC);
        2. Sunwest Water and Electric Co. (SUWECO) for the 1.5 MW Hitoma 1 & 2.1 MW Solong Hydroelectric Power Plants; and
        3. ORMECO for the 2.1 MW Linao Cawayan Mini-Hydro Power Plant (LCMHPP) - Lower Cascade.

        Accounting for the inflows and outflows of the UC fund leaves it with a balance of about PhP1.659 billion as of January 2018.

      • Remittances for CY 2018

        For the month of January, PSALM received PhP2.562 billion in UC remittances, broken down as follows:

        UC Remittances to PSALM
        For the Period January 2018 (In PhP Billion)

        Month ME (NPC-SPUG) ME (REDCI) EC SCC SD Total
        January 1.045 0.012 0.017 1.312 0.176 2.562

      • Disbursements for January 2018

        For the month of January 2018, PSALM disbursed a total amount of PhP2.346 billion to UC beneficiaries as follows:

        UC Disbursements of PSALM
        For the Period January 2018 (In PhP Billion)

        Month ME (NPC-SPUG) ME (REDCI) SCC1/ Total
        January 1.040 0.007 1.299 2.346

        1/Transferred from the UC-SCC STF to the UC-SCC SFA of PSALM

        For the month of January 2018, PSALM disbursed PhP1.040 billion to NPC-SPUG to fund the missionary electrification functions, chargeable against the UC-ME fund. This is pursuant to the following ERC Decisions/Orders:

        Date Particulars ERC Case No.
        12 August 2013 ERC Decision on CY 2011 True-up Adjustments (PhP4.651 billion) 2012-085 RC
        10 October 2013 ERC Decision on CY 2010 True-up Adjustments (PhP2.566 billion) 2012-046 RC
        03 November 2013
        & 17 August 2015
        ERC Order on CY 2015 UC-ME Subsidy 2014-135 RC
        20 April 2015 ERC Order on CY 2014 UC-ME Subsidy (PhP2.763 billion) 2012-085 RC

        In accordance with the ERC decision dated 28 January 2013 under Case No. 2011-091 RC, the amount of PhP1.299 billion was transferred from the UC-SCC STF to the UC-SCC SFA for the month of January 2018.

  3. ERC - Approved UC Rates
  4. The table below shows the ERC-approved UC rates being implemented as of 31 January 2018:

    Type PhP/kWh
    UC-ME 0.1561
    UC-EC 0.0025
    UC-SCC 0.1938
    Total 0.3789

    On 03 November 2014, the ERC issued an Order provisionally approving the instant petition filed by NPC on the proposed Subsidized Approved Generation Rate (SAGR) and the UC-ME for years 2015 to 2016. NPC was authorized to extend the implementation of the current CY 2014 UC-ME subsidy amounting to PhP0.1561/kWh from January 2015 to August 2015, broken down as follows:

    Particulars CY 2015
    UC-ME Subsidy 0.0454 0.1163
    Cash Incentive for RE Developers 0.0017 0.0017
    True-up Adjustment (2011) 0.0709 0.0000
    True-up Adjustment (2010) 0.0381 0.0381
    Total 0.1561 0.1561

    Further, the ERC issued an Order dated 17 August 2015 extending the provisional authority it granted under the ERC Order dated 03 November 2014, until revoked or made permanent by the ERC.