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Sharp Edges

Did DoE or NGCP lie about the power supply?

Secretary Alfonso Cusi of the Department of Energy (DoE) had assured the public since January of a stable supply of power this summer, specifically for the May 13 elections.

In March, Energy Undersecretary Felix Fuentebella said that supply would likely be normal in the next four months with the hotter weather having little impact.

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If ever the Luzon grid would need augmentation due to forced outages, he said the Visayas grid can be tapped for 200 megawatts (mw) and the Malaya thermal plant in Pililla, Rizal, for 150 mw.

The National Grid Corporation of the Philippines (NGCP), on the other hand, told a different story, predicting that in May, consumer demand would hit an all-time high.

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It forecasted that demand in Luzon would reach 11,403 mw or about 527 mw more than last year. Demand in Visayas (2,053 mw last year) and Mindanao (1,853 mw last year) would increase by 12 percent and peak around December.

But now, the Luzon grid has gone on red alert several times, resulting in rotational brownouts of three to four hours in the Manila Electric Co.’s (Meralco) franchise areas and some provinces. People are starting to ask, are officials of the DoE and NGCP talking to each other? Why did they differ in their 2019 forecast? Is there an attempt to mask the real power situation? The 2013 and 2017 power crises “inflated” our Meralco bills. “Syndicated activity” was discovered among power plants that colluded with each other and manipulated their prices. The Department of Justice filed cases against the now-defunct Wholesale Electricity Spot Market (WESM) and some power plants. WESM was replaced last year by the new Independent Electricity Market of the Philippines. However, the cross-ownership of power plants still exists despite the Electric Power Industry Reform Act of 2001 or Republic Act No. 9136 that prohibits it.

After 18 years, the cabal of corporate oligopoly clearly has too much power over our senators and congressmen who look the other way.

The central issue here is the continuing government guarantee for all electricity produced by independent power producers, specifically their “stranded costs.” The much hated purchased power adjustment during President Fidel Ramos’ time was removed by the Energy Regulatory Commission (ERC) but it was integrated into the universal charge-stranded contract costs by NGCP.

For Meralco, even the rate of return base charge of 12 percent went up to 14.9 percent. Its old rate of P0.79 per kilowatt hour (kwh) was changed by ERC into the performance-based regulation of P1.64/kwh, thus increasing its income from P2.7 billion to P19 billion.

At the end of the day, consumers will bear the brunt of these blackouts during the long hot summer. And quite sadly, we will be giving our hard-earned money to the government and its protected energy players that rack up hefty profits.

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In the heat of the campaign period, barangay chairs in a city in Metro Manila are all abuzz about getting “manual sirens” from their local government. The sirens were allegedly bought for P172,000 each.

However, the real cost was pegged by several barangay chairs at only P19,000 to P20,000 each. With every barangay getting a siren, the alleged total kickback for a certain local official was estimated at over P20 million.

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Tune in to the “Banner Story” radio-TV show, Monday-Friday, 6-9 a.m., on dzIQ (990AM), ABS-CBN TV Plus Channel 30. E-mail [email protected] for comments.

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TAGS: DoE, Felix Fuentebella, Jake J. Maderazo, Luzon Power Supply, NGCP, Sharp Edges
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