'Emergency powers to benefit private firms'

Posted at 03/05/10 6:01 PM

MANILA, Philippines -- A debt coalition strongly criticized the possible granting of emergency powers to President Arroyo as a solution to the power crisis in Mindanao. The move, according to them, would only benefit the private power players through increased power rates.

"There is a shortage but it does not merit an emergency situation. What the shortage merits is immediate and a long-term response," Maite Pascual of the Freedom from Debt Coalition (FDC) told journalists in a press briefing on Friday.

Pascual reiterated that the emergency powers will only benefit the private firms engaged in the energy industry. The Electric Power Industry Reform Act (EPIRA) of 2001 mandated the privatization of power-related assets of the state-owned National Power Corporation (NPC).

She also explained that during emergencies, privately-owned power generation groups can demand higher rates for supply.

The rotational blackouts in Mindanao have been going on since 2009 as the worsening dry spell caused water levels in reservoirs to reach critical levels, creating a major sag in power supply in the hydro-dependent Mindanao grid.

Energy secretary Angelo Reyes recommended that the president invoke Article 71 of EPIRA and grant the NPC resources to acquire generators to augment the very thin supply in Mindanao.

"The money to be used to fill the 3-month shortage will take decades to pay," Pascual stressed. Her group has been advocating against debts incured by the Philippine government.

Further, the group doubts if supply is indeed short as reported as there are non-hydro power plants, which can be used to increase supply. "We think that there are non-hydro plants that are shut down," Pascual said.

Failure of EPIRA

The group likewise stressed the failure of the EPIRA, which was supposed to re-engineer the power sector system and eventually provide reliable, efficient, and cheap power.

They also scored the energy department for lacking foresight since shortages have been projected as early as 2001, the same year EPIRA was enacted into a law.

Secretary Reyes has cited the EPIRA for reportedly limiting the opportunities to invest in new power plants. He said

Pascual also criticized the current state of the energy industry, specially the creating of a spot market for power.

"WESM (Wholesale Electricity Spot Market) is only a front to show that we are developed, but it's not working for us," Pascual added. She explained that the market is very small and majority of the distribution is handled by the Meralco group.

Moreover, Pascual added that the current players are the same people and companies who had been involved in the energy industry for years.

"GMA (President Gloria Arroyo) should not ask for emergency powers but declare the failure of EPIRA," Wilson Fortaleza of FDC stressed.

Once the president declares a failure in the said act, Pascual noted that new frameworks for a better and more reliable energy system could be discussed and implemented.