Cebu City councilors have taken the Visayan Electric Co. (Veco) to task for allegedly implementing a policy that requires electricity service applicants to pay a hefty deposit among other charges.
Citing one complaint as an example, Councilor Nida Cabrera said those applying for service reconnection are being made to pay a deposit equivalent to their unpaid utility bills on top of the deposit for the installation of meters.
“How do we qualify these deposits? Are these surcharges or overcharges? Do we get a refund?” she asked representatives of the Energy Regulatory Commission and the Department of Energy at yesterday’s public hearing called by the City Council to shed light on local power issues.
Councilor Noel Wenceslao raised a concern on the legality of the collection of deposits, a policy which Veco implemented only recently.
“When do we get a refund for the installation fee?” Councilor Nestor Archival asked.
Archival, head of the City Council energy committee, said it is important for residents to understand what the collection of deposits are for and if these are made part of Veco’s profits.
“Ang mga tawo gi bug-atan na gyud kaayo,” he said. (The people are very much burdened.)
Joel Bontuyan, ERC regional director, said the collection of “security deposits” is legal.
He said the deposits should be returned to the consumers after three years, if they have no unsettled bills or if they want to discontinue availing of Veco’s services.
Quoting ERC rules, Bontuyan said payment of security deposits should be made to earn interests.
Councilor Alvin Dizon moved for the holding of an executive session on Aug. 20 so that the City Council could further discuss consumers’ concerns against local power distributors and suggestions on how to improve the Electric Power Industry Reform Act (Epira).
Bontuyan said a series of consultations have already been made in Cebu and Davao on the planned amendments to the Epira.
Concerns raised during the consultations include the need to do away with value added tax on electricity bills and the need to grant the president the authority to immediately take action in case of power supply deficiency.
DOE regional director Antonio Labios said businessmen cautioned against the planned amendment of the Epira as sending a “wrong signal” to businesses and financing institutions who may be looking at investing in the power industry.
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