‘Power mess’ and power rates increase could have been avoided

This is in reaction to Rep. Walden Bello’s article, “The power mess: How we got into it and how to get out.” (Inquirer, 4/23/12)

His analysis is highly commendable and ought to be given serious consideration by the government especially because not many elected officials have conscientiously taken time to look into and offer solutions to the country’s major problems such as the crippling cost of power.

For a better appreciation of the “power mess,” however, certain areas should be equally taken into account.

First of all, the Electric Power Industry Reform Act (Epira) gave the Department of Energy sufficient powers to ensure a stable, reliable, secure and affordable supply of electricity. DOE Circular No. 2003-12-011, which enjoins all distribution utilities (DUs, electric cooperatives included) in the country “to supply adequate, affordable, quality, and reliable electricity,” was issued in the exercise of these powers.

This and the submission by the DUs of their respective annual distribution development plans; by the National Grid Corp. of the Philippines of its annual transmission development plan; and by the generation companies of their plans—all of which are incorporated into the Power Development Plan and Philippine Energy Plan—are all meant to ensure that there will be no power crisis in the country. Unfortunately, from among the more than 100 electric cooperatives (ECs) in the country all under the awesome powers of the National Electrification Administration, very few have taken the initiative to comply with the DOE circular.

This is the reason Nasecore filed with the Energy Regulatory Commission (ERC) in March 2010 a petition to compel DOE to enforce DOE Circular 2003-12-011 in Mindanao. Unfortunately, to this date, the initial hearing has never been set by ERC.

Second, ERC also has equally sufficient powers to ensure that the power rates are just and reasonable for consumer protection. ERC is the one that grants the revenue requirement of the more than 140 power utilities, including the Philippine Electricity Market Corp.; this revenue requirement is divided by the historical annual sales in kilowatt-hours to derive the rate per kilowatt-hour so as to allow the utility to recover their just and reasonable costs of providing a service and ensure their viable operation.

Naturally, even if the rate per kWh remains the same, the annual revenue of the utility will increase owing to the natural increase in consumer consumption.

We believe that if the DOE and ERC would just put to heart their respective mandate and have the boldness to implement what the law says, Epira will not be ridiculed as it is and we may just have the just and reasonable rates we all deserve.

With these two powerful agencies, consumers are asking: Why are we into this power mess?  Perhaps, it is not the Epira that should be repealed, as any law can only be as good as the people want it to be.

—PETE L. ILAGAN,

president,  National Association of

Electricity Consumers for Reforms Inc. (Nasecore),

[email protected]