Aquino ally warns of unstable power supply, outages

By: 11 years ago

INQUIRER FILE PHOTO

MANILA, Philippines — Militant lawmakers cheered the Supreme Court temporary restraining order on Manila Electric Co.’s (Meralco) rate increase as a timely gift to consumers this Christmas.

But for Oriental Mindoro Representative Reynaldo Umali, chairman of the committee on energy at the House of Representatives, the high court’s intervention could lead to unstable power supply and more power outages.

“The SC TRO is good for consumers but my worry is for long-term supply stability. The TRO has cast a cloud of uncertainty on Meralco’s supply contracts with generation companies that have provisions that allow them to automatically pass on fuel rate fluctuations to customers. Without this guarantee, the generation companies will likely balk at any long-term supply agreements,” said Umali in a phone interview.

Umali said that he was surprised that the Supreme Court acted on the petition for a TRO, considering its effect on investor sentiment.

Umali reckoned the best option would have been for the high court to ignore calls for the TRO while Malacañang used the Malampaya Fund to cover for the P8 billion to P10 billion required to meet the P4.15 per kilowatt hour rate hike sought by Meralco.

Umali, whose committee was the first to tackle the alleged collusion of power industry players, said that more evidence on the alleged collusion of power plant owners to shut down at the same time while Malampaya was on preventive maintenance would come in the next few days. The evidence, he said, would allow the Department of Energy and Energy Regulatory Commission to better judge whether the industry players conspired to ramp up prices.

Bayan Muna Rep. Neri Javier Colmenares dubbed the Supreme Court TRO a “welcome relief” to consumers. “It is good that the Supreme Court granted the request of petitioners and the people because it is a timely Christmas gift for the people. The TRO also has stronger legal basis than mere announcements of the Department of Energy (DOE) or the Energy Regulatory Commission (ERC) to suspend collection,” said Colmenares in a statement.

Bayan Muna Rep. Carlos Isagani Zarate said the Supreme Court TRO was just a “partial victory.”

“We still have to continue the fight for the consumers’ rights so that this unprecedented and unjust TROed increases must be totally nullified as well as the culprit provisions of the EPIRA law,” said Zarate in a text message.

ACT Teachers Rep. Antonio Tinio expressed hope the high court would come out with a decision that would “curb the cartel-like practices in the power generation industry, Meralco’s connivance leading to predatory rates, and the ERC’s failure to exercise its powers and functions in behalf of the public.”

“We hope that the Supreme Court will take this opportunity to rule that power generation is a public utility and key portions of the EPIRA unconstitutional, thereby paying the way for a reversal of decades of privatization and a return of the national government to the energy sector,” said Tinio in a statement.

Kabataan Rep. Terry Ridon commended the Supreme for acting swiftly to defend the public interest. “We cannot allow power generation companies to continue operating without accountability to the public. Distribution utilities cannot also remain unpunished for business miscalculations resulting in unreasonably higher power rates,” said Ridon.