Independent audit needed | Inquirer Opinion

Independent audit needed

/ 04:07 AM December 04, 2019

There is now independent corroboration of the troubling disclosure made recently to senators about the state of affairs in the National Grid Corp. of the Philippines (NGCP).

In a report, CNN said it was able to obtain an internal report prepared for lawmakers that said the country’s power grid, which transports power generated by power plants all over the country to electricity distributors which then bring the power to commercial and industrial establishments as well as households, is under “the full control of the Chinese government and could be shut off in time of conflict.”


That’s essentially what Melvin Matibag, president of the National Transmission Corp. (Transco) which owns the NGCP, had earlier revealed to senators in a budget hearing, according to Sen. Sherwin Gatchalian, chair of the Senate energy committee.

The confidential report seen by CNN is unambiguous in its warning: With the Chinese government having “the full capability to disrupt national power systems,”the Philippines’ “national security is completely compromised due to the control and propriety access given by the local consortium partner to the Chinese government.”


The NGCP, however, brushed off such fears. There is no way, it said, that China can remotely shut down the power infrastructure in the Philippines; the system is not controlled by the Chinese and is instead securely in Filipino hands, with the State Grid Corp. of China (SGCC), which owns 40 percent of the company, limited to “technical adviser” status: “SGCC serves only as the technical adviser of the consortium, but the management and the control of NGCP, including its Systems Operation, are exclusively exercised by Filipinos.”

Chinese foreign ministry spokesperson Geng Shuang echoed that denial in a briefing in Beijing on Nov. 27.

“The allegation of China’s control over the Philippines’ power grid or threat to the country’s national security is completely groundless,” he said, adding that operations are “operated, managed and maintained by the Philippine side” with the Chinese partner offering just “technical support.”

Such assurances are all well and good — but they are not enough. The Senate would do well not to take the NGCP and Beijing’s word on the matter, and conduct their own independent inquiry.

Bayan Muna has filed a resolution in the House of Representatives likewise calling for an investigation into the economic and national security implications of having Chinese capital in NGCP (since “China is currently aggressive over its claims on the West Philippine Sea depicted through its intrusions to Philippine territory and disrespect to Philippine sovereignty, the surrender of control over the Philippine power system and other public utilities is a clear threat to Philippine national security,” it said), but given the more subservient posture of members of that chamber toward Malacañang, and their general aversion to angering the President who has assiduously hewed to cozy ties with Beijing, a formal probe has more chances of getting off the ground in the Senate.

President Duterte himself seems staggeringly blasé and nonchalant about the whole thing. He publicly pooh-poohed the idea that China would resort to sabotaging the country’s power grid operations, because “We’re friends, we’re doing business.”

And if that country does, for some reason, cut the power?


“Then there will be a quarrel,” said Mr. Duterte. “You will receive from me a mouthful then I go to other places and look for help.”

Those words are sure to send shivers up and down Beijing’s spine.

The Department of Energy, thankfully, does not seem to share the President’s glaring display of unconcern. It said that given that there are aspects in the existing franchise agreement with the NGCP “that seem inimical” to the best interests of the FIlipino people, it was “fully supportive” of the call of the Senate to take a closer look at the administrative, operational and procedural structures within the NGCP.

“We consider the Senate hearings as a positive development toward the long overdue and much-needed audit of NGCP, as well as the comprehensive reexamination of the franchise agreement, which is part of the Presidential directive to review all government contracts that appear to be onerous,” it added.

Right on. The soothing words by the NGCP and the Chinese government amount to nothing, unless independent observers are allowed to peer into and audit the power company’s operations unhindered, and a full report is made to the public for thorough, unambiguous scrutiny. On this far-reaching national security issue, the Senate and the people should insist on nothing less.

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TAGS: Inquirer editorial, NGCP independent audit, Philippine power grid, SGCC, State Grid Corp. of China
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