City urges review of power distributor’s franchise amid brownouts

ILOILO CITY—The Iloilo City government has asked Congress to review the franchise of the city’s lone power distributor amid continued brownouts lasting for hours.

In separate letters to Sen. Franklin Drilon and Iloilo Rep. Jerry Treñas, Mayor Jed Patrick Mabilog asked the legislature to review the franchise granted to the Panay Electric Co. (Peco) and to consider opening a franchise to other power distributors.

Peco is the lone distributor of the city’s 180 barangays and one of the oldest private electricity distributors in the country.

Mabilog said in his letter that recent power interruptions had caused “great distress and much discontent” to Peco consumers.

He cited the crippling blackout on May 2 that left most of the city without electricity for at least eight hours.

“As a result, most businesses incurred losses; private and public offices ceased operations; meat products and processed food blemished, and social functions/gatherings canceled. All these unexpected power failures have caused millions of pesos in losses with no valid explanation from Peco as the sole power distributor in the City of Iloilo,” Mabilog said.

Power interruptions in the past were mostly blamed on the lack of power supply but  supply had been stabilized after the operation of a 164-megawatt coal-fired power plant last year.

Mabilog said opening the franchise to other power distributors would help the city provide sufficient and reliable supply of power.

Peco operations manager Randy Pastolero said it was normal for power distributors to suffer technical problems from time to time. He said the crippling brownout on May 2 was caused by technical problems with its substations which triggered a system-wide malfunction.

“We are working with the city government to improve our power distribution,” Pastolero said on Thursday.

He also pointed out that under the Electric Power Industry Reform Act, power transmission and distribution are “natural monopolies” with only one franchise given in an area.

Peco has a 25-year franchise granted by Congress in 1994 which would expire in 2019, according to Pastolero.