LANAO POWER CONSUMERS FEDERATION (LAPOCOF) POSITION VS. THE PRIVATIZATION OF AGUS-PULANGUI HYDROPOWER COMPLEXES

I. IT WILL DEFINITELY INCREASE OUR ALREADY HIGH ELECTRICITY RATES

Mensahe para sa ika-2 General Assembly ng EmPOWER Consumers

September 5, 2009, Quezon City

Loretta Ann P. Rosales

Vice President, Freedom from Debt Coalition

Isang mainit na pagbati sa lahat ng kasapi ng EmPOWER Consumers!

Ang pagtitipon na ito ay lubhang napapanahon bunga na rin ng patuloy na walang-patid na pagtaas ng presyo ng kuryente mula sa kaliwa’t kanan na mga petisyon sa Energy Regulatory Commission. Alam natin na hindi lamang sa generation sector nagmumula ang mga aplikasyon sapagkat nariyan rin ang mga distribution utilities, transmission charge at ang bagong supply sector mula sa tinatawag na Wholesale Electricity Market o WESM na sampung porsyento na ating binabayarn mula sa generation charge. Sa pangkalahatan, ito ang mga bumubuo sa ating hinarap na hamon mula ng itayo natin ang EmPOWER Consumers noong Oktubre 1, 2007. Ilan sa mga tampok na isyu ng kuryente sa kasalukuyan ay tatalakayin ng ating mga tagapagsalita sa hapong ito.

Ganumpaman, ang ipinakikita nating kapasyahan na sumulong sa gitna ng napakaraming usapin sa industriya ng kuryente, pati na rin ang mga pagsusumikap na unawain ang kumplikadong mga usapin tulad ng mga teknikal at pinansyal na isyu mula sa ibat ibang petisyon, ay isang malaking inspirasyon sa milyon-milyong Pilipino na patuloy na lumalaban at pumapasan sa pabigat na mataas na presyo ng kuryente.

GENERATION COMPANIES & INDEPENDENT POWER PRODUCERS DIRECTORY

NPC-OWNED 1. National Power Corporation-Leyte Geothermal Power Plant 2. National Power Corporation-Masinloc Coal Fired Thermal Power Plant 3. National Power Corporation – Angat Hydroelectric Power Plant 4. Batangas Coal-Fired Thermal Power Plant 5. Bacon-Manito Geothermal Power Plant Complex 6. Palinpinon Geothermal Power Plant I and II 7. Binga Hydroelectric Power Plant 8. Bohol Diesel Power Plant 9. Magat River Hydroelectric Power Plant 10. Pantabangan Hydroelectric Power Plant

BusinessWorld August 24, 2009, Page 1 http://www.bworldonline.com/BW082409/content.php?id=002 Debt recovery plea to hike power costs Jose Bimbo F. Santos The Power Sector Assets and Liabilities Management Corp. (PSALM) has filed a petition seeking to recover about P471 billion in debts of National Power Corp. (Napocor), which could translate to an average increase of 30 centavos per kilowatt-hour for consumers. The Energy Regulatory Commission (ERC) said it had scheduled hearings from September to October on the privatization body’s June petition regarding Napocor’s stranded debts, or unpaid financial obligations which have not been liquidated by the proceeds from state power asset sales.

A broad consumer group of electricity users with 50 member-organizations today expressed opposition to the pre-bidding conference that the government would be holding for the National Transmission Corporation citing several negative effects over the sale of its assets and liabilities to private hands.

EmPOWER Consumers said bidding out Transco’s assets, which is vested with public interest, poses a threat on the national security with a private company taking hold of all the transmission lines in the country.

“The winning bidder of Transco would be holding the switchboard of the entire country and has the power to turn it off at will.  Even Malacañang would be on its knees before Transco’s would-be owners begging for electricity once this happens,” warned the group.

Milo N. Tanchuling, EmPOWER Consumers spokesperson and Freedom from Debt Coalition secretary general, said the public and the government would be at the mercy of the private company which would own Transco.

“The private company that would own Transco would only be accountable to its owners and not to the public.  It could do whatever it wants with the transmission lines, hold power at source or raise prices exorbitantly to recover costs,” he said.

News accounts showed that the number of bidders pre-qualified to bid for the National Transmission Corp.’s 25-year concession contract has been trimmed down to three.

These include Terna-Rete Elettrica Nazionale S.P.A. of Italy with Two Rivers Holdings Pacific of the Metro Pacific group of businessman Manny Pangilinan; Malaysian group Tenaga Nasional Berhad with Newbridge Asia LLP in partnership with Triratna Holdings; and State Grid of China with Monte Oro Resources.

Tanchuling also berated Power Sector Assets and Liabilities Management (PSALM) Corp. Jose Ibazeta for his announcement that the bidding of Transco would be done behind closed doors.

Ibazeta said the bidding would be done out of the public eye as requested by the bidders to withhold their identity from the people.

Tanchuling said he finds no reason for government to sell such a company which is bringing in the money for government in terms of revenues and exchange it for spot cash.

“What is more important to PSALM? The interest of the public or of these private bidders.  For a company which owns P15 billion annually and provides the connection between generation and distribution, there is so much public interest at stake that Transco’s bidding could not be done behind closed doors,” he added.

He pointed out that holding Transco’s bidding out of public scrutiny violates Art. II, Sec. 28 and Article III, Sec. 7 the Constitution and the Government Procurement Act (RA 9184) which mandates that there must be “transparency in the procurement process” and guarantees “public monitoring” to ensure that the bidding process is done in accordance to the law.

Tanchuling said bidding out Transco to a private company would only provide immediate relief but long-term pain with rates expectedly going up once the transmission company is privatized.

He noted that the winning bidder of Transco would have clean books as the loans incurred by the company would be absorbed by the government and passed on to the public.

“The Philippines is rich in experience in terms of privatization and we have already witnessed with our very eyes the horrors it brings to us.  We do not expect anything good to happen to this undertaking besides giving the people more reason to castigate the government for its endless miseries,” he said.

Tanchuling said Transco should remain public to ensure a steady and reliable supply of electricity nationwide and all privatization efforts by the government on the power industry should be put to stop.
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EmPOWER Consumers
Draft Press Statement
November 14, 2007

We, members of Empower Consumers, reject the appointment of another politician – former Pampanga Rep. Zenaida  Ducut – as the acting chairperson of the Energy Regulatory Commission (ERC).  An inexperienced chief who has no track record in the fields of regulation and in protecting consumer interests and welfare is not what the complex and ailing power industry needs today.

The ERC is a crucial agency responsible for the direction of the vital power industry and the fate of electricity consumers.  It regulates the whole power industry including penalizing fraud and abuse of market power by power utilities.  It also determines just and reasonable electricity rates and approves, grants, and revokes licenses, permits as well as certificates of compliance of electric industry participants.

In 2006, industrial electricity rates in the Philippines were the highest in Asia while residential rates were the third highest.

We are deeply concerned about serious allegations raised against acting ERC Chairperson Ducut, specifically on her supposed close ties with the Arroyo family as well as her reported links with the other Ducut’s who are with a consortium involved in an anomalous coal-supply contract with the National Power Corporation. If true, these ties may impair justness and prudence in ERC decisions, considering that the First Family and its cronies are now seemingly getting deeply involved in the power industry especially in transmission and generation sectors and attempting to take control of Meralco – the biggest distribution utility in the land – through its ally GSIS President Winston Garcia.

The consumers had suffered enough under the past ERC chairpersons who were politicians like Manuel Sanchez and Rodolfo Albano, Sr. Under their watch, ERC rendered decisions favorable to the power utilities but had adverse impacts on the consumers, especially the poor. They have shown glaring inability to discern the difference between the private interest and the public interest, and the lack of will to promote the public good against private greed.
During Albano’s watch, we saw electricity rates increased from P7 to as high as P11/kWh, ERC approved overcharging by MERALCO through its various rulings and ‘preliminary authority’, and overpricing that ERC blithely legitimized by approving electricity charges by MERALCO without the necessary diligence to ensure that the least cost was being passed on to consumers.

We also saw the ERC under Albano, in grave neglect of duty, condone NPC’s over-collection of billions of pesos from the consumers by turning a blind-eye to NPC’s failure to correct its foreign exchange currency denominated obligations every three months, as required by law. In the most recent instance, 21 months had passed and some ten billion pesos were over-collected by NPC from consumers before ERC felt compelled to act.  Albano also failed to expedite the refund to consumers of Meralco’s meter and bill deposits.

That Mr. Albano presided over an ERC riddled with a shoddy record, where good governance was replaced with regulatory capture, and still would have the nerve to recommend his daughter-in-law to succeed him, is a direct affront to 12 million Filipino households which he and the ERC had victimized and made poorer throughout his watch at the ERC.

The selection of the new ERC Chair must be guided by the highest sense of propriety, among others. The appointing authority should ensure an open and transparent process of selection to choose the candidate with utmost probity, competence, and commitment to the public good and the common welfare.

We call upon Gloria Arroyo to put an end to appointing political allies and cronies as rewards to such a crucial post as the ERC. The bad practices of traditional politics have no place in what should be a modern and modernizing ERC.  Instead, someone who has the competence in regulation and a track record in promoting and protecting the public interests should be the chief regulator.

The ‘trapo’ mindset of the politicos has no place in the Commission.  “Good riddance, Chairman Albano. NO! to another politico in ERC.”

PRESS STATEMENT
EmPOWER CONSUMERS
15 July 2008

GMANews.TV
29 April 2008
http://www.gmanews.tv/story/92257/ADB-told-to-stop-pushing-for-privatization-of-RPs-food-power-sectors
04/29/2008 | 05:15 PM

MANILA, Philippines – The Asian Development Bank (ADB) should stop pushing for and profiteering from the privatization of the Philippines’ energy and grain sectors amid the skyrocketing prices of rice and electricity, civil society groups said in a statement.

The Philippine Working Group on the ADB, which engages the bank on various issues, made this call one week before the bank holds its 41st Annual Meeting of the Board of Governors in Madrid, Spain, on May 3 to 6, 2008.

PRESS RELEASE
Philippine Working Group on the ADB
Contact persons:
Milo Tanchuling, Freedom from Debt Coalition (FDC) secretary general, @ 0920-9018711
Maris dela Cruz, EmPower Consumers secretariat, @ 0929-6829903
Alice Raymundo, Task Force Food Sovereignty (TFFS) secretariat,@ 0922- 8065536
Bobby Diciembre, FDC media campaigner, @ 0920-9059856

FOR IMMEDIATE RELEASE
29 April 2008

MANILA, Philippines—The Asian Development Bank should stop pushing for and profiteering from the privatization of the energy and grain sectors in the country amid the skyrocketing prices of rice and electricity, according to civil society groups.

The Philippine Working Group on the ADB issued this call days before the Bank’s 41st Annual Meeting of the Board of Governors in Madrid, Spain, on 3-6 May 2008.

BusinessMirror
25 April 2008, Page 1
http://www.businessmirror.com.ph/0425&262008/headlines04.html

By Paul A. Isla and Butch Fernandez
Reporters

THE Philippine Electricity Market Corp. (PEMC) reported that
intermittent operation and high demand for power supply from
coal-fired power plants have pushed up prices at the Wholesale
Electricity Spot Market (WESM).

The PEMC said the WESM’s final prices for the period covering February
26 to March 25 showed an average market price or effective settlement
price (ESP) of P6.72/kilowatt-hour (kWh), higher than the previous
month’s ESP of P5.73/kWh.

By Abigail L. Ho
Philippine Daily Inquirer
First Posted 06:21:00 04/25/2008

http://business.inquirer.net/money/breakingnews/view/20080425-132581/Power-firms-urged-to-explain-rate-hike-in-April

MANILA, Philippines-EmPOWER Consumers, a recently formed electricity
consumers group, is calling on the Energy Regulatory Commission (ERC)
to compel all power industry stakeholders to explain why electricity
prices suddenly spiked this month.

In a letter to the ERC, the group, together with the group Freedom
from Debt Coalition and the National Association of Electricity
Consumers, said the regulatory body should convene a meeting of major
industry players, such as power retailer Manila Electric Co.
(Meralco), government-owned producer National Power Corp., state-owned
National Transmission Corp., power bourse operator Philippine
Electricity Market Corp. and the privatization agency Power Sector
Assets and Liabilities Management Corp.