ARTICLE II – RULES

PERTAINING TO DISTRIBUTION
CONNECTION ASSETS AND
SERVICES
Effects of the DSOAR
• Published in the Manila Standard on
February 2, 2006
• Effective on February 17, 2006
• Repealed ERB Res. No. 95-21 as
amended
– All technical provisions were transferred
to the DSOAR
• Complements the Magna Carta
 Dispute Resolutions (Art. 1.10)
• Rules of Procedure Governing Complaints Filed with
the CAS
• Consumers can file complaints with the ERC
• Defendant has 10 business days to answer from
receipt of the order or date of the conference
whichever comes earlier
• Pre-hearing conferences are set to resolve issues
amicably
• If no settlement, case will undergo hearing; but may
be heard using summary procedure
• Summary Procedure applies to:
– Claims involving not more than P200T
– Issue is incapable of pecuniary estimation
• Status quo is maintained for cases of violation of
contract
Standard Connection Facilities
(Arts. 2.3-2.4)
• The DU shall identify standard connection
facilities for each customer segment
• Unbundled Standard Connection Charge for
each customer segment
• DSOAR Rules provide for methodology for
computing Standard Connection Charge
• Standard Connection Facilities and Standard
Connection Charges are subject to ERC
approval
• Within 180 days from effectivity of Customer
Segment Guidelines, DUs shall submit an
application for approval of unbundled standard
connection charges (SCCs) for each customer
segment
New Connection Points or Modifications to
Existing Connection Points (Art. 2.5)

• The connection applicant shall complete a

Connection Application provided by the DU in
accordance with the provisions of the DSOAR
Rules and the Distribution Code
• For residential customers – add the requirement of
an undertaking by the owner to be solidarily liable
with the applicant-tenant for regular bills incurred
after the applicant leaves the premises (Magna
Carta for Residential Electricity Consumers)
• All connections and disconnections of service shall
be made by the DU
• Service drops, service entrance, service switches
or breakers, underground service and groundings
shall be governed by the PEC and ERC rules and
regulations
Right to Extension of Lines and Facilities –
Residential Consumers (Arts. 2.6.1-2.6.2))

• Customer is within 30 meters from DUs

existing secondary low voltage lines, he has
the right to extension of lines and facilities
• Customer is beyond 30 meters, he may
advance cost of line and additional facilities
subject to reimbursement from the DU
through:
– Issuance of notes payable
– Refund at the rate of 25% of gross distribution
revenue derived from the calendar year or 5
years, whichever comes earlier
– Purchase of preferred shares
Right to Extension of Lines and Facilities –
Residential Consumers (Art. 2.6.3)

• Transformer for the sole use of a single

residential customer -
– customer to pay the actual cost of the
transformer and such
– payment shall not be subject to refund and will
be treated as a Contribution In Aid of
Construction
• Not applicable if –
– installation of the transformer is part of the
Standard Connection Facilities for the End-
user’s Customer Segment; or
– due to the isolated nature of the customer.
Right to Extension of Lines and Facilities –
Non-Residential Consumers (Art. 2.7)

• Expense of the utility

• For equipment and facilities to be
installed are within the levels found in
the Standard Connection Facilities
used to compute the Standard
Connection Charge for that end-user’s
customer segment
Standard Connection
Facilities
Standard Connection
Facilities
Non-Standard
Connection Facilities
Engineering and Design
(Arts. 2.6.4 & 2.7.3)
• DU shall be responsible for the engineering,
design and inspection of all line extensions
• End-user to provide all information
pertaining to load characteristics required to
develop the design.
• Free Service to the end-user and become
part of the DU’s operation and maintenance
expense account
Minimum Facilities for the Design
(2.7.4)
• DU to require only minimum facilities consistent
with the Distribution Code
• Cost of facilities in excess of minimum facilities
shall be the sole expense of the requesting party
and treated as Contribution in Aid of Construction
(CIAC)
• DU requests for facilities in excess of minimum
shall be considered as Electric Plant Held for
Future Use
• Design the line extension from the nearest existing
source of available capacity to the End-user’s
delivery point along the shortest practical route.
• Design also an alternative route in anticipation of
additional customers, additional costs shall be at
the DUs sole cost and expense and considered
Electric Plant Held for Future Use
Easements (Arts. 2.6.8 & 2.7.7)
• Residential customers – located
beyond 30 meters shall advance the
cost for the easement subject to the
refund scheme of extension of lines
and facilities
• Non-residential customers – DU to
obtain rights of way at the sole
expense of the end-user
Procurement of Equipment and Construction
(Arts. 2.6.10 & 2.7.9)
Residential Customers
• Connection
Customers/applicants have
the right to select own
contractor and/or equipment
vendor for the equipment,
construction and installation
of Distribution Connection
Assets
• Customers beyond 30 meters
of DU’s existing secondary
low voltage lines are eligible
to receive a refund at the rate
of 25% of gross distribution
revenue for the calendar year
for 5 years until such amount
is fully refunded, whichever is
shorter.
Non-Residential Customers
• Connection
Customers/applicants have the
right to select own contractor
and/or equipment vendor for the
equipment, construction and
installation of Distribution
Connection Assets
• Ownership of the said
Connection Assets will be given
to the End-user under the
following conditions:
– End-user shall transfer
ownership of said facilities
to the DU in the event that
any portion of these facilities
become necessary to
provide service to other
Connection Customers.
Such facilities shall then be
subject to the proportionate
sharing provision of Section
2.7.10 of the DSOAR;
Procurement of Equipment and Construction
(Arts. 2.6.10 & 2.7.9)
Residential Customers
• Said refund shall not exceed
the DU’s proposed estimate
for constructing the
Connection Assets or the
actual cost incurred by the
end-user, whichever is lower
• Since amounts paid for the
construction are subject to
refund, the residential
customer shall pay the
relevant Standard
Connection Charge
approved by the ERC
Non-Residential Customers
– Facilities owned by the
End-user will be
restricted solely for the
use of that end-user
– End-user agrees to
procure and pay for all
necessary maintenance
services for the owned
facilities; and
– Only those facilities that
pass through private
property may be owned
by the End-user
Proportionate Sharing of Line Extension Costs –
Non-residential customers only (Art. 2.7.10)

• Any end-user is allowed to connect to facilities

treated as CIAC
• Within 5 years from construction, end-user shall
pay DU a CIAC equivalent to one-half of the CIAC
paid by the previous end-user times the
proportionate ratio of the distance utilized by the
newly connecting end-user plus any added facilities
in excess of the standard connection facilities
• DU shall return the CIAC paid by the newly
connecting end-user to the end-user/s who
originally made the CIAC in proportion to the
relative amounts originally paid by each.
Contribution in Aid of Construction

• Any facility treated as CIAC shall become

the property and maintenance responsibility
of the DU
• Not subject to refund by the DU and shall
not become part of the DU’s rate base or
appraised property value.
• Necessary replacements shall be at the
expense of the DU and shall become part
of rate base consideration.
• End-user has the option to pay for the
replacement.
Metering Provisions
(Art. 2.11)
• All meters including instrument
transformers – tested and sealed by ERC
prior to installation
• Calibrated to as close to zero error as
possible
• Plus/minus 2% - tolerable limits but
resulting only from wear and tear
• Plus/minus 3% - tolerance limit at any load
to be allowed to remain in service
• Test and seal meters once every two (2)
years
Effects of Meter Testing
(Arts. 2.11.6 & 3.5.7)
• Stop Meter with no evidence of
tampering – DU to recover a
maximum period of 3 months (Ridjo
Tape case)
• Defective Meter with no evidence of
tampering – DU to recover a
maximum period of 6 months
• Fast Meter – customer to recover
overbillings equivalent to a maximum
– period of 6 months
Proper Installation of Meters
(Art. 2.11.1)
– Meter is easily accessible and visible for
reading and testing
– Located on outside wall or private pole
with a height between 1.52 meters to 3
meters
– Location subject to exemptions
– Borne by the utility except:
– Customer requests for relocation
– Meter installation fails to meet the conditions
due to improvements made by the customer
ARTICLE III. RULES
PERTAINING TO SERVICE TO
THE CAPTIVE MARKET
Bill Deposits – applicable to all customer
classes (Art. 3.4.1)
• Applicants for new and additional service shall be
required to pay bill deposits
• Equivalent to the estimated monthly billing of the
applicant
• Adjusted yearly
• Earn Interest equiv. to :
 incorporated in the WACC, otherwise, the prevailing
interest rate for savings deposit approved by the BSP –
residential customers
 Interest rate for savings deposit – non-residential
customers
• Bill deposit may be reimposed if, after refunding,
the customer defaults in the payment of monthly
bill
Bill Deposits – applicable to all customer
classes (Art. 3.4.1)

• applicants with established credit

• relocate their electric service
• no bill deposits
• applicants lose credit when they
default in paying their bills
• additional account - separate deposit
Meter Deposits – Applicable to all
customers (Art. 3.4.2)

• All customers are exempt from

payment of meter deposits
• Customer shall shoulder cost of meter
replacement if he caused the loss or
damage of the meter
• Meter deposits of existing customers
are to be refunded
Bills and Billing Formats
(Art. 3.5)
• Bills are rendered monthly
• Bills shall conform with the format
approved by ERC
• Format to include info that when
disputes cannot be settled, they can
be elevate to ERC
• Pay bills within:
– 9 days from receipt – residential
– 10 days from receipt – non-residential
Estimated bills – DSOAR intro
(Art. 3.5.4)
• Use estimate due to:
– Force majeure
– Outside the control of the DU
• Bills using estimates are only allowed
when the meter fails to register the
consumption for the entire billing
period
• More than two consecutive bills using
estimates are not allowed
Estimated bills (Art. 3.5.4)
• Any of the following methods in the order of
priority shall be used to estimate usage
– Average daily usage of the customer during the
portion of the billing period registered by the
meter applied to the remaining days in the
billing period
– The average usage of the customer during the
preceding 3 months
– The usage of the customer during the same
month of the preceding year
– If time of use rates and metering are applicable,
then the estimated bill shall rely on the relevant
time of use load profile data during the previous
month
Estimated Bills (Art. 3.5.4)
• After using 2 consecutive estimated
bills, the DU shall:
– Read the meter during the next billing
cycle and adjust the estimated bills
accordingly; or
– Take an initial meter reading following
the next billing cycle as if service was
starting anew and no charges will be
levied on the customer for the skipped
billing cycle
Adjustments of Billing Errors
(Art. 3.5.7)
• Errors due to pilferage are governed by the
RA 7832 and its IRR
• Errors from defective/stop meters are
governed by the Magna Carta
• Other billing errors shall be subject to the
following:
• Refunds:
– Overpayments - computed back to the date on
which the error commenced,
– error or omission is due to the fault of the DU
• a bill for undercharge be computed for a period not
exceeding 3 months
Billing Disputes (Art. 3.6)
• Prompt investigation of complaints
• DU to inform complainant of action
taken thereon within 15 days from
receipt of complaint
• DU shall inform customer of right to
file complaint with the ERC
Thank You