Aquino signs law on Olongapo power privatization

OLONGAPO CITY—While a few villages in the city still reel from sporadic brownouts, President Benigno Aquino III has signed a law granting a 25-year franchise to a private company to take over the city’s power distribution system.

Republic Act No. 10373 allows Olongapo Electricity Distribution Co. Inc. (OEDC) “to construct, install, establish, operate and maintain for commercial purposes in the public interest, a distribution system for the conveyance of electric power to the end-users in the city of Olongapo and its suburbs.”

OEDC, an affiliate of Cagayan Electric Power and Light Co. Inc. (Cepalco), will take over the city government-run power distributor, the Public Utility Department (PUD).

Rehabilitation of the power distribution system’s infrastructure will start amid talks of a power disconnection triggered by debts owed by the city government to Power Sector Assets and Liabilities Management Corp. (Psalm), Mayor James Gordon Jr. said.

“Rumors of blackouts spread by my political opponents should already be put to rest by President Aquino’s approval of the franchise. Cepalco will take over the power distribution network of the city and ensure that efficient services and affordable power rates will be delivered,” Gordon said.

Earlier, Energy Secretary Jericho Petilla announced that Albay, Nueva Ecija and Olongapo City could be hit by blackouts due to debts owed to power suppliers.

Last week, First Gen Hydro Power Corp. (FGHPC), which supplies electricity to Pantabangan Municipal Electric Services (Pames), cut off its supply to Pantabangan town in Nueva Ecija after Pames failed to settle its bills.

But Gordon said Pantabangan’s experience would not be repeated in Olongapo because the city government is up to date in paying its bills. The PUD’s privatization guarantees that Olongapo will have an adequate supply of electricity for residents and businesses, he said

The modernization thrust “will ensure that inefficiency, corruption and lack of resources to improve the system will be a thing of the past,” the mayor added.

Asked about the fate of employees of PUD who will be affected by the privatization of its assets, Gordon said: “Workers not hired by Cepalco or maintained by the city will get a generous severance package and [we] will help them find new jobs or start their own businesses through training and livelihood programs.” Robert Gonzaga, Inquirer Central Luzon