For cheaper electricity

The raging controversy on the national franchise being sought by a private firm to set up solar-powered mini-grids across the country can only be expected.

What we don’t want to happen is for the debate to muddle the real objective of this venture, which is to provide cheaper electricity, especially in areas with no power or those trapped by the expensive services of inefficient suppliers.

Solar Para sa Bayan Corp., founded by Sen. Loren Legarda’s son Leandro Leviste, is seeking a government license to put up small solar-battery grids to bring electricity to unserved areas and spur competition — that hopefully will bring down prices — in other rural areas.

It is initially targeting 12 towns nationwide to benefit 200,000 Filipinos. It is already providing electricity to towns in Mindoro, Palawan, Masbate, Cagayan and Aurora, and aims to serve half a million Filipinos by the end of this year in towns seeking better electric service.

As expected, electric cooperatives have registered strong resistance; they see Leviste’s venture as an incursion into their franchise areas.

The Philippine Rural Electric Cooperatives Association (Philreca) has claimed that Leviste’s move to secure a national franchise from Congress is against the provisions of the Electric Power Industry Reform Act (Epira). The bloc also has allies in Congress.

A group of lawmakers filed last month House Resolution No. 2182 urging the committee on rules to revert to the legislative franchise panel House Bill No. 8179, which seeks to grant Solar Para sa Bayan a franchise for its solar mini-grid projects. The group alleged that the approval of the committee report was “railroaded.”

Existing power cooperatives, which receive government subsidy for their operations, have challenged Solar Para sa Bayan to focus on such areas as Sulu and other unserved towns.

Fair enough; Leviste’s firm should focus on providing electricity to unviable, unserved or underserved areas that a franchised distribution utility, such as members of Philreca, would be unable to service.

But, on the other hand, why should it not be allowed in areas where electricity cost has become too much of a burden to consumers, who have no other choice but the power monopoly in their district?

Malacañang should consider public support for the bill. For instance, the National Association of Electricity Consumers for Reforms Inc. has noted that, as electric services in the provinces have remained poor and expensive 17 years after the Epira law was enacted, new measures should be undertaken to fulfill the intent of the law, which is to bring cheap electricity to as many Filipinos as possible.

The fears of creating a monopoly are unfounded as well. On the contrary, the presence of such new technology will create competition in areas where services are wanting.

As pointed out by Deputy House Speaker Arthur Yap, principal sponsor of HB 8179, the measure is specifically designed to break the existing monopolies of traditional utilities that have fallen behind in improving the quality of their service due to a lack of competition.

Leviste himself noted that the text of the bill speaks for itself: It is nonexclusive, encourages others to apply for the same, and aims to end the existing inefficient monopolies on electricity by giving consumers new choices for better and cheaper service. It also incurs zero cost on the part of the government.

Leviste has a point in his riposte to his critics: If, instead of trying to prevent competition, utilities focus on lowering costs and improving their operations, then Filipinos will be satisfied with their electric service, and there will be no need for Solar Para sa Bayan at all.

What is wrong with giving a private firm the nonexclusive right to construct small solar-battery grids at no cost to the government?

It will provide consumers, particularly in rural areas, an alternative electricity supplier, and perhaps pave the way for more competition in the power industry that, in turn, will hopefully bring down prices.

Opposing novel initiatives such as this will only institutionalize the inefficiencies of electric utilities, to the continuing detriment of Filipino consumers.