David Celestra Tan, MSK
8 December 2019
To say that the current Philippine power sector is a mess is an understatement. This supposed privatized and deregulated power industry is so only in form and pretention. Even before they finalized the EPIRA LAW that launched it, it already betrayed the ideal that all these are being done for the public interest, for the sake of a stronger and more competitive Philippines.
I have been in consumer advocacy for almost 10 years although my power projects were advocacies by themselves. I meant to retire in 2010 and just like anyone had this desire to give something back to the community. And You try to give back your god given possession that can have the most value to the most people. I just happened to see all these from a special vantage point at various stages.
I thought the perspectives were unique and wanted to leave for posterity those power industry insights. We have had successes in power reform but mostly frustrations because you always run into traitors – both the perpetrators and the facilitators. You keep on wondering why and why the Filipinos deserve this kind of treatment from its own people.
I guess we can say that my consumer advocacy is Part 2 of my involvement in power policy and deregulation. Born out of human desire to see the next chapter after being part of writing Part 1 and to help if you can in implementing them correctly, trying to explain and shedding light on any aspects that have become muddled by the vested interests or just the confused interests.
TRAITORS OF THE EPIRA LAW
Republic Act 9136 or the EPIRA Law of 2001 is a very Filipino type of legislation and national policy. It is replete with good aspirations for the public interest, for least cost power, for anti-monopoly and anti-competitive behavior. In fact the best part and the best of the Filipino is contained in Section 2, Policy of the State, where all the wonderful things the Filipinos can wish for in an electric power industry reform act (EPIRA) are just gorgeously written. But then just a few chapters in, you know that the law has been pulled towards different directions, many times actually betraying the very aspirations they so wonderfully set in Section 2.
That policy making and implementing formula remain true today. You read most of the DOE and ERC Circulars, Guidelines, and resolutions. They all start by enumerating the ideals that they are supposed to achieve, evidence that these bureaucrats knew what they are supposed to accomplish, but then proceed in the next part for implementation in ways that are totally inconsistent, directly contradict itself. You feel like the first part was written from the heart and the second part written from the pocket. A smart alec friend of mine said the first part is supposed to make the public feel at ease and trusting at the noble and erudite ideas of the authors and once you drop your guard and done bother to read the rest, they got you and they try to get away with their real agenda. I can’t help but agree.
There are so many traitors in the writing of the Epira Law
1. The guy who watered down the original aspiration to totally ban cross ownership among the three main power sectors – distribution, transmission, and generation. They succeeded in redefining cross ownership to only between Transco and the rest and in fact bannered their conquest by titling Section 45 as cross ownership and anti monopoly. A lot of what ails the industry and working against the consumers are the evils of monopoly and market domination that emanated from this betrayal.
2. The guy who in the last minute allowed under Section 45 for distribution utilities to contract up to 50% of its power needs from an affiliated company. Even the big guys up to that point were lobbying only for 35%. This ushered in the era of negotiated power supply contracts that will terrorize the consumers for at least the next 15 years.
3. Not satisfied, the guy who marginalized safeguards on market domination of the power generation sector by writing a watered down Rule 11 of the implementing rules and regulations of the EPIRA law, contradicting the main law that it is supposed to implement. And the TWG and the Secretary of Energy who oversaw the writing of the EPIRA IRR. Whoever did this must be hunted down and tried for big time treason. If Meralco is blatantly trying to dominate 100% of its power requirements into the next decades, it is because they can do so under this effete Rule 11.
4. The group who superseded the EPIRA LAWS provision that the rule making function of the transmission system that is called “systems operator” must be retained by the government owned Transco. Instead they allowed that transmission policy making and rules be transferred to the concessionaire and operator of the transmission system. Do you even privatize rule making functions that affect the public interest? Systems Operator is not the same as operating its system.It is akin to privatizing the justice system or the legislative system? Certainly with that kind of license to print money, the NGCP concession became very valuable.
5. The guys who put in the provisions in the EPIRA law that will pave the way for the adoption of the PBR, the reviled performance based rate making. The consumers were doomed even while the EPIRA Law was still being finalized in the first half of 2001.
Imperfect Law Imperfectly Implemented
It has been a double whammy against consumers. The imperfections of the Epira law need not be imperfectly implemented. With a good heart Loopholes can be closed or tightened. The EPIRA law for all its imperfections are so flexibly written that the implementors like the DOE and mainly the ERC could have executed them in ways that nonetheless safeguard the public interest.
Where art thou JCPC?
It has been for 19 years going badly for consumers. All we have is the opposite. We have atrociously high rates, monopoly, non-competitive markets, and undependable power development. The promises of the EPIRA law only happened in shape and ritual. None of the genuine ideals of stable power supply and least cost power.
Actually there are structurally several levels of oversight to insure the corrective action is needed if the EPIRA Law is not achieving its stated goals in Section 2.
But a sign that we the consumers seem to have been left to the wolves is the invisibility of the Joint Congressional Power Committee that is supposed to be the last line of oversight over the effectiveness of the EPIRA and any needed updating. The last interaction I had with anyone from them they said they don’t have any budget. Or were they incapacitated intentionally so they don’t spoil the apple cart of the big buys?
Kawawa naman tayo. Or Kawawa lang ba tayo kung naiintindihan natin na kawawa tayo?
The TRAITORS? Or CONQUERORS? Nahh I am not going to name them. There are so many. But don’t worry. We will try not to get deterred.
let us hope and pray for our Camelot or sky walker. A Duterte for the power sector wars. Or just get used to feeling sorry for ourselves….as you pay your bill because your power is about to get disconnected.
MATUWID NA SINGIL SA KURYENTE CONSUMER ALLIANCE INC.