Questions for First Gas, Meralco

It is kind of reassuring that the Palace, through Communications Secretary Sonny Coloma and Energy Secretary Jericho Petilla, has “suddenly” come out saying the government wants Congress to inquire into the validity of Meralco’s impending electricity rate hike. Suddenly, because both officials had previously practically accepted hook, line and sinker the reasonableness of the hike soon after the power company’s announcement. Of course, the government may have now been reconsidering its earlier position owing to the noise barrage and wild protests of several cause-oriented groups regarding the unprecedented magnitude and untimeliness of the rate increase.

We can all agree that the selling price of every article of commerce must rise correspondingly with  the rise in the cost of the materials used in its production. With the Malampaya natural gas plant, First Gas Corp., which gets the liquefied natural gas (LNG) from Malampaya to run its Batangas generation plants, now on its annual scheduled shutdown, is compelled to temporarily switch to the comparatively more expensive bunker oil for fuel. Very well said, indeed!

Nevertheless, methinks there are a number of considerations that perhaps only a congressional inquiry may satisfactorily clarify. The Malampaya gas plant has been operating for several years now, such that this December shutdown is definitely not the very first it has gone through. During similar shutdowns in the past, did First Gas always switch to fuel oil?  If so, why does it seem this is the first time ever that First Gas has used bunker for fuel and is passing on its higher cost to Meralco?  Since plant shutdowns are almost always planned and scheduled well in advance, why didn’t First Gas buy and store extra quantities of gas in anticipation of the Malampaya shutdown—a mere exercise of elementary management prudence, isn’t it?—thereby avoiding the truly unprecedented power rate increase at a time consumers have to contend with two other equally significant cost increases in the offing: those of liquefied petroleum gas and the Metro Rail Transit fares?  Finally, is the price variance between bunker fuel and LNG indeed that much as to rightly dictate the more than P3 increase, at minimum, that Meralco is asking?

After all shall have been said and done during the congressional probe, and notwithstanding the ongoing public rallies denouncing increase, I am afraid Meralco would still push through with it given the inevitable “pass-on” nature of its operating costs under existing laws.  At most, the costs may only perhaps be staggered.

However, truly honest answers to the foregoing questions should hopefully enable our lawmakers to impress upon Meralco that the Malampaya shutdown alone is not always necessarily a valid excuse for increasing its electric power bills.  And that is especially since as far as I know First Gas and Meralco belong to the same group of companies, between which collusion may not be totally discounted.

Meanwhile, I cannot help but knit my brows in dismay that the Energy Regulation Commission, after initially endorsing the power rate hike completely and without much ado the very day Meralco first announced it, is suddenly in the news saying it also intends to deliberate on it.

—RUDY L. CORONEL,

[email protected]