THERE is this businesswoman and apartment owner in Parañaque. She is so implacably mad at the Meralco that for the past 41 months, she has been settling her monthly electricity bills with a check on which she also writes, in big block letters, the words: “MERALCO MANDURUGAS” (scammer or swindler).

For 40 months, Meralco didn’t seem to mind. It accepted the especially annotated checks as if its customers did that sort of thing all the time. But finally, last month, the manager of the branch office in the area refused to accept her 41st check on the ground that it was an insult to the corporate institution.

“For the past 40 months,” the lady argued, “you have been accepting and encashing my check payments.” She told the manager that the words she writes on her check payments were simply an expression of her frustration and anger over Meralco’s outrageous rates and heavy-handed practices. “Masyado ninyong kinakawawa kaming mga customers ’nyo.”

It’s not clear what happened afterward. The above account was given by Pete Ilagan, president of the National Asscociation of Electricity Consumers for Reforms (Nasecore), in the course of a radio interview with dwIZ in my radio program Business is our Business. What this at least indicates is that the ranks of angry, dissatisfied Meralco customers seem to be inexorably swelling.

More and more people are getting the uneasy feeling that there seems to be no end to the repertoire of excuses Meralco is using to jack up our electricity bills. Yet we who compose its captive market of 4.2 million household, commercial and industrial consumers in its megafranchise area seem to be in a state of paralysis. We feel utterly helpless in the face of the added loads Meralco has been putting on our overburdened shoulders for the past decade.

A true public-service utility becomes worthy of the franchise given to it by the state only if it can conscientiously balance its financial goals with its need to keep its clientele at least satisfied, if not deliriously happy, with its service. This obligation to the public that it serves, I think, is called social responsibility. Under the Electric Power Industry Reform Act (Epira)—and even in its own franchise, for that matter—it is provided that Meralco must strive to exhaust all means to provide power to its clientele “at the least possible cost.”

What’s happening, sadly, is the exact opposite. For Meralco, it seems, there is only one driving force—the need to maximize profits. Hang social responsibility! Let the people suffer. If anybody complains, disconnect!

That it lacks a sense of social responsibility is clearly demonstrated by the fact that it has managed to pass on its corporate income-tax payments to its customers. If it had its way—which is most of the time, by the way—it would pass on to its customers every conceivable cost, including those of the amenities of the Meralco theater, its tennis courts, all the perks and gambling losses of its top executives, and maintenance of its luxury estate in Antipolo.

The Supreme Court, in November 2002, ordered the Meralco to return to its customers some P30.02 billion it had illegally collected from its customers for several years. The amount represented the income-tax payments the corporation should have paid to the government, but instead had chalked it up as an operating expense that it passed on to its customers.

It was a decision of the Energy Regulatory Board (ERB), forerunner of the Energy Regulatory Commission before the passage of the Epira, that emboldened the Meralco to pass on its tax obligation to its customers. The ERB, then under Chairman Manuel Sanchez, allowed Meralco to increase its return on rate base (RORB) from 12 percent to 15.5 percent. By increasing the RORB, Meralco had in effect tucked in its income-tax obligation in the category of expenses that it could legally pass on to its customers.

Five years have passed since that landmark ruling of the Supreme Court, and Meralco has yet to fully return the P30.02 billion to its customers. In its 2006 financial statement, the Meralco had paid only P12 billion, which means it has yet to return some P18 billion to its customers. What’s curious is that despite such a huge outstanding liability, Meralco this year has been able to declare cash and stock dividends to its stockholders of around P6 billion.

Meralco has now asked the ERC to allow it to use a new rate-setting scheme called performance-based rate making, or PBR. Under this newfangled scheme, the rate of return is called WACC, or weighted average cost of capital.

This strikes experts in the power- industry sector as something akin to money laundering. Having been exposed for its clever scheme to tuck in its income-tax obligations in the RORB, it now is resorting to the PBR. In money laundering, you let the dirty money pass through legitimate channels, and presto—what comes out seems legitimately earned cash. The ERC, ever-supportive of the Meralco instead of the public’s interest, recently ruled that the WACC that would be allowed Meralco is 16.07 percent, but Meralco is not satisfied. It wants a bigger WACC.

The experts are unanimous in saying that the WACC is a commercial rate of return. It would be unfair to Meralco’s customers if Meralco—which is not your garden variety corporation but a public utility—is allowed to get away with this new clever ploy. As a public utility, the public’s interest should be its primary concern, not its net profit.

Meralco was given an exclusive franchise to provide electricity distribution service to the public. As such, it enjoys the invincibility of a monopoly. Its investments and capital expenditures—all come from its customers. It is even protected against foreign- exchange losses.

These unique attributes of a public utility should be factored in when computing its RORB. It should not be allowed to charge a commercial rate of return.

Meralco makes us all believe that it is in a special world where it should get special treatment and all conceivable privileges—all in the name of the public that it serves. It wants us to shoulder even its income tax—while overcharging us with all sorts of cockamamie costs.

When, oh when, will it all end?  

Omerta_bdc@yahoo.com

THE curious dilemma posed by the steadily rising peso, both to the country’s leaders and various sectors that directly feel its impact, provides yet another argument for the notion that economic growth should not rest unduly on any one sector or activity in order to be sustainable.

OVER the weekend one of the country’s leading dailies carried a story that added an interesting angle to that $465.5-million cyber education project that Gloria Arroyo suddenly found to be a very attractive substitute for the aborted $330-million ZTE broadband network deal.

FOR two years Indian Prime Minister Manmohan Singh, a self-proclaimed “politician by accident,” invested the little political capital he had into reaching an accord on civilian nuclear-energy cooperation with the US.

John F. Wasik: How to blissfully ignore reasons for 1987 crash

What were you doing and feeling during the 1987 stock-market crash, which will be 20 years ago this week?

Having married just two weeks prior, I was about a year into a great new job. When I saw the biggest one-day percentage loss in the Dow Jones Industrial Average on October 19 and the near-meltdown that followed, I froze. I didn’t call my mutual-fund companies or broker. I stayed in stocks, where almost all of my meager wealth was invested.

THERE is this businesswoman and apartment owner in Parañaque. She is so implacably mad at the Meralco that for the past 41 months, she has been settling her monthly electricity bills with a check on which she also writes, in big block letters, the words: “MERALCO MANDURUGAS” (scammer or swindler).

Do I have to have a living will? Last year, I had an experience that gave me the distinct impression that if I didn’t have one, my life was hardly worth, well, living.