Petilla’s record
THE ENERGY portfolio is among the most controversial in the government because it deals with a very sensitive commodity—electricity. Add to this the volatility in crude oil prices, and anyone heading the Department of Energy will find the job a tough balancing act. The Philippines being a country that imports nearly all its oil and fuel requirements, the energy chief’s fate fluctuates with the ups and downs of oil prices. Resigned energy secretary Jericho Petilla was fortunate to leave the government when crude prices have dropped by half since late last year.
More often than not, however, an energy secretary’s stint is remembered by the power supply situation at the time he or she steps down, and whatever accomplishments are done at the DOE and the energy sector in general are relegated to the sidelines. This is true for Petilla. From the start, his appointment was met with opposition and criticism because he was a politician who served three terms as governor of Leyte. (Politicians in executive positions are usually frowned upon because of their alleged lack of qualifications, among other things.)
Petilla also left the Aquino administration with a power shortage looming on the horizon. The public cannot but put the blame squarely on him because the DOE chief is expected to ensure that the power situation is normal (or that the DOE has a long-term plan ensuring adequate electricity supply no matter the economic conditions in the future).
Yet a review of Petilla’s performance as energy secretary since 2012 will show a number of accomplishments toward improving the power sector—not headline-grabbing stuff, but nevertheless beneficial to the economy.
One accomplishment of the management engineering graduate of Ateneo de Manila University is the overall improvement in power-generation investments due to his carrot-and-stick approach: faster DOE action on applications and stricter monitoring of implementation.
A better-reported achievement is the much-improved renewable-energy investment climate due to the approval and implementation of the much-delayed Feed in Tariff (FIT) scheme. Petilla even became controversial when he implemented a first-come-first-served policy for FIT for renewable-energy projects in an effort to speed up the implementation of environment-friendly power ventures.
It was also under his stewardship when the dispute between Korean firm Kepco and the state-owned Manila Waterworks and Sewerage System over the Angat hydroelectric complex was resolved and Kepco’s partnership with San Miguel Corp. formalized.
Petilla had said he would leave the DOE with 60 power plants either completed or committed, with a combined capacity of 4,500 megawatts, all within President Aquino’s term. In comparison, there were only nine projects approved—with a combined capacity of 1,200 MW—during the previous administration.
It was also Petilla who made sure that measures were in place to cope with the tight power supply in Luzon this summer. These include the ILP, the voluntary interruptible load program under which businesses with generator sets (such as mall owners) may be asked to use their equipment to ease demand from the grid, thus helping prevent power shortages. In exchange for using their generator sets, ILP participants will be given compensation to be set by regulators.
Given the DOE’s preparations for the expected power shortage, the government’s ongoing monitoring of the power situation in Luzon and the Visayas now indicates that the supply for the remainder of summer would be sufficient to meet the projected demand.
It is just unfortunate that Petilla did not complete one major task that could have lowered electricity rates: opening the power supply contracts of private distribution utilities such as Manila Electric Co. to competitive bidding instead of allowing these firms to self-negotiate the generation charges that are eventually passed on to consumers. It is our hope that the next energy chief will make this a priority.
Petilla’s resignation may be the subject of unfavorable commentaries especially in the social media. Still, the man deserves commendation for doing his best given the many variables beyond his and the government’s control. And thus far, power supply remains adequate and oil firms have kept pump-prices depressed.
