Tag Archives: Electric Power Industry Reform Act (EPIRA)

Power to the People Coalition calls for People’s Resistance Against the Aquino Emergency Power

The passage of the Joint House Resolution 21 giving President Aquino emergency powers at a time when the people are still reeling from typhoon Ruby and despite popular clamor against this Congressional moves—is a blatant disregard of the people’s will and rights. Like thieves in the night, the congressmen passed the resolution which continues to stand on a shaky legal and factual basis, despite protests from various quarters. To this date , Secretary Petilla and even Malacanang miserably failed to justify the need for such power using Section 71 of EPIRA as its legal shield.

This will lead us to doubt the real intentions for the emergency power. The DOE even admitted that the emergency power will not ensure that there will be no power rate hike next year.

One thing is clear though. Private corporations generating power supply for their needs and will be mobilized in the Interruptible Load Program( ILP) of the government will stand to benefit from this emergency power. It is not surprising why the likes of Henry Sy of SM is eager and willing to participate in the said program. The government’s solution to resolve the power crisis means pushing for its pending and new coal power plant projects that face legal and popular opposition, particularly from impacted communities. Therefore, we continue to assert that the proposed measures will only benefit corporate interest and will further violate human rights of the people and destroy the environment.

There is no long-term solution to the perennial power supply crisis and the unending rise in power costs other than for the government to repeal EPIRA, junk the privatization regime, and put under public control the power industry. A decisive component of this is to restore to Government its planning and regulatory powers apart from restructuring ownership of power generation, transmission and distribution in favor of the State and the public.

The Power to the People coalition will never stop and will continue to campaign against this dangerous and destructive emergency power measures of the government. The people need to be vigilant and active in stopping any measure that will lead to their harm and the betrayal of their interests and sovereign will. They should oppose any emergency measure that will ram through dirty and harmful energy projects like the new coal power plants, destroy the environment and exacerbate our climate crisis. We will welcome the year 2015 with continued protest actions if the government will remain intransigent and ride roughshod over the people’s rights and interests and ignore the snowballing public demand for the scrapping of the emergency power and the repeal of EPIRA.

Let this be a warning and a notice to this power-hungry administration.

NO TO EMERGENCY POWER!

REPEAL EPIRA NOW!

NO TO COAL ! YES TO RENEWABLE ENERGY !

Power crisis real, strategic but gov’t doing mere quick fix – labor coalition

The emerging power crisis is a cruel outcome of a bad policy under the Electric Power Industry Reform Act (EPIRA) that cannot be resolved by the proposed emergency power President Aquino is seeking from Congress, the labor coalition Nagkaisa said in a statement.

The group said it is not common for ordinary workers to comment on techno-economic aspects of the power industry, but for this coming celebration of Bonifacio Day on November 30, labor will come out loud on this along with other big issues because the high cost of power in the country is making the lives of ordinary workers more miserable.

According to Wilson Fortaleza, spokesperson for Partido Manggagawa (PM) and one of the convenors of Nagkaisa, “this quick-fix solution via an emergency power to address a decade-old problems of escalating rates and diminishing supply reignited labor’s apprehension that once again, a power crisis is being transformed into business opportunity for the private sector.”

Fortaleza was referring to the Interruptible Load Program (ILP) and power contracting being pursued through a joint resolution in Congress that would grant the President emergency powers to address the expected power shortage in 2015.

He said the ILP can be pursued by the Department of Energy (DoE) even without the President exercising emergency powers because it is merely a demand-side management issue and not production of additional generating capacity as required under Section 71 of EPIRA.

“Likewise, the foreign and privately-operated National Grid Corporation must first be made to account for its primary responsibility to secure reliable supply, including sufficient reserve capacities,” argued Fortaleza.

The group explained that the ILP is a mode for utilizing standby power or embedded generating capacity available in several establishments such as malls and commercial buildings. During shortage, their utilization means an x amount of freed megawatt capacity that can be supplied by Meralco to other users.

Fortaleza, however, said that for this alone an emergency power is not needed. So why is Malacanang asking for it? The group can only think of the following scenarios:

– Under the ILP enrollment is voluntary but enrollees will be compensated to incentivize their participation

– But because there is no system currently in place to exactly determine the price of compensation, imposing a universal levy – an x amount per kWh to be charged to consumers take-or-pay – is the most likely scheme.

– Retail electricity suppliers (RES) who already posses contracted capacities under the open access (but which they cannot supply to their contestable market because most of them are also ILP players) will also be compensated.

These, in effect, will result to rate increases. But Fortaleza insists that a take-or-pay levy cannot be charged to consumers under ILP since embedded generation sets were designed or were practically built by industry players to address expected and non-expected outages.

“So why do we have to pay them for that temporary sacrifice? And why will Henry Sy, John Gokongwei and Jaime Ayala charge an x amount per kWh from everyone, including non-mall users?”

The group argued further that the only valid excuse for utilizing emergency powers is when the government goes back to generation, stop industry fraud, and makes a decisive shift to renewable energy and energy democracy.

Revoke Meralco Franchise, Pull the Plug on EPIRA

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On Valentine’s Day, the Power to the People Coalition tell Meralco, “It’s Over.”

Meralco has failed the Filipino people. They promised cheap, widespread access to electricity, yet the only thing they mustered thus far are scandalous electricity rates that they expected ordinary Filipinos to meekly comply with.

Meralco has consistently regarded ordinary Filipino consumers with the heartless, corporate greed for profit. The most recent spike in power rates proved this. Meralco made the absurd argument that it is not responsible for the record-high electricity rates simply because it had no power over the forced outages their power suppliers implemented. It became even more ridiculous when Meralco played the victim by claiming that it had no choice but to source power from the Wholesale Electricity Spot Market (WESM) for the power deficit.

Nothing could be farther away from the truth. Documents submitted to the Supreme Court showed that it was Meralco’s order to power supplier Therma Mobile, which it controls, to bid at the maximum allowable price of P62.00 per kilowatt hour no less than 25 times during that period that was responsible for the skyhigh clearing price at the WESM. In short, Meralco gamed the market to benefit itself and other power producers. By doing so it defrauded its consumers whom it is obligated to supply electricity at the least possible cost.

We belie Meralco’s claims that it was powerless over the simultaneous forced outages of its power producers. The shutdown of Malampaya for maintenance, and the shutdown of two other power plants for the same reason, were all scheduled. Meralco saw it coming, and they took the most convenient and profitable course of action. They chose to sit back, game the power industry, and make consumers pay for it all.

That Meralco systematically abused the Filipino people is but a symptom of the failure of the Electric Power Industry Reform Act (EPIRA). We must not forget that EPIRA is the main source of the problem; it put the whole industry under the gang rule of private power – from generation to transmission sectors, all the way to the cooperatives in the distribution sector. Privatization of the power industry has resulted in monopoly control, inefficient power delivery and sky-high prices, in direct contradiction to the promises EPIRA made to attain efficiency and break the monopoly in the electricity industry, and lower power prices. That Meralco’s profits have risen over 100 per cent since EPIRA went into effect in 2001, and that Meralco has the power to game the market at the expense of the people is a monstrous example of EPIRA’s failure.

13 years of Meralco’s greed and EPIRA’s exploitation of power consumers have pushed the people to a deeper level of destitution. To this, we raise our voice and declare that this abusive relations is over.  We call on the government to heed the people’s call: it is high time the government revokes Meralco’s mega-franchise and pulls the plug on EPIRA.

Revoke Meralco Franchise, Pull the Plug on EPIRA

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On Valentine’s Day, the Power to the People Coalition tell Meralco, “It’s Over.”

Meralco has failed the Filipino people. They promised cheap, widespread access to electricity, yet the only thing they mustered thus far are scandalous electricity rates that they expected ordinary Filipinos to meekly comply with.

Meralco has consistently regarded ordinary Filipino consumers with the heartless, corporate greed for profit. The most recent spike in power rates proved this. Meralco made the absurd argument that it is not responsible for the record-high electricity rates simply because it had no power over the forced outages their power suppliers implemented. It became even more ridiculous when Meralco played the victim by claiming that it had no choice but to source power from the Wholesale Electricity Spot Market (WESM) for the power deficit.

Nothing could be farther away from the truth. Documents submitted to the Supreme Court showed that it was Meralco’s order to power supplier Therma Mobile, which it controls, to bid at the maximum allowable price of P62.00 per kilowatt hour no less than 25 times during that period that was responsible for the skyhigh clearing price at the WESM. In short, Meralco gamed the market to benefit itself and other power producers. By doing so it defrauded its consumers whom it is obligated to supply electricity at the least possible cost.

We belie Meralco’s claims that it was powerless over the simultaneous forced outages of its power producers. The shutdown of Malampaya for maintenance, and the shutdown of two other power plants for the same reason, were all scheduled. Meralco saw it coming, and they took the most convenient and profitable course of action. They chose to sit back, game the power industry, and make consumers pay for it all.

That Meralco systematically abused the Filipino people is but a symptom of the failure of the Electric Power Industry Reform Act (EPIRA). We must not forget that EPIRA is the main source of the problem; it put the whole industry under the gang rule of private power – from generation to transmission sectors, all the way to the cooperatives in the distribution sector. Privatization of the power industry has resulted in monopoly control, inefficient power delivery and sky-high prices, in direct contradiction to the promises EPIRA made to attain efficiency and break the monopoly in the electricity industry, and lower power prices. That Meralco’s profits have risen over 100 per cent since EPIRA went into effect in 2001, and that Meralco has the power to game the market at the expense of the people is a monstrous example of EPIRA’s failure.

13 years of Meralco’s greed and EPIRA’s exploitation of power consumers have pushed the people to a deeper level of destitution. To this, we raise our voice and declare that this abusive relations is over. We call on the government to heed the people’s call: it is high time the government revokes Meralco’s mega-franchise and pulls the plug on EPIRA.

Oppose Meralco’s Threat to Trigger Brownouts if TRO is not Lifted! Revoke Meralco’s License and Repeal EPIRA!

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Meralco, the electricity monopoly, threatened its 5.3 million consumers with brownouts if the temporary restraining order (TRO) on its scandalous 4.5 peso per kilowatt hour is not lifted.

The threat was made by Meralco lawyer Victor Lazatin during the Supreme Court hearings on the rate hike on Feb. 4.

Consumers will not tolerate this blackmail.

On the pretext of losing vast amounts of money, this monopoly, which made 17 billion pesos in profits in 2013, is trying to derail the investigation of its role in the suspicious series of events that led to the rate increase. Meralco has put the blame on seven of its power suppliers that went offline when the Malampaya natural gas plant underwent maintenance from Nov. 11 to Dec. 10, 2013, allegedly forcing Meralco to go to the Wholesale Electricity Spot Market (WESM) for its power deficit. But documents submitted to the Supreme Court showed that it was Meralco’s order to a power supplier–Therma Mobile—that it controls to bid at the maximum allowable price of 62 pesos per kilowatt hour no less than 25 times during that period that was responsible for the skyhigh clearing price at WESM.

Meralco gamed the market, to the detriment of its consumers whom it is obligated to supply at the least possible cost. Moreover, Meralco would not have resorted to buying at WESM’s inflated prices had it made provisions for reserve power from its suppliers in the event of a foreseeable event like the Malampaya shutdown. As President Aquino himself has said, ““There is periodic maintenance [of Malampaya] required. That’s a foreseeable event. If you know what producers of fuel will not be able to produce, then you have to find a substitute. So preparation should have been made for foreseeable events.”

But the problem goes beyond Meralco. It goes beyond the Energy Regulatory Commission, which is the classic example of a regulator that is in the pocket of the regulated. It goes beyond the Department of Energy, which has shown itself to be completely incompetent in planning for the energy needs of the country. The main source of the problem lies in the Electric Power Industry Reform Act (EPIRA), which has placed power generation, transmission, and distribution completely in the hands of the private sector.

Privatization has resulted in monopoly control, inefficient power delivery, and sky-high prices, not in more efficiency, less concentration, and lower prices. Meralco, whose profits have risen over 100 per cent since EPIRA went into effect in 2001, is a monstrous example of EPIRA’s failure.

13 years of exploiting consumers is enough! We demand the revocation of Meralco’s license and the repeal of EPIRA.

Workers call for reformatting of the power industry

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The power industry needs not just a reboot but a major reformatting to better serve the country’s current and future energy needs and to satisfy the people’s clamour for affordable and sustainable power.

This, according to the labor coalition Nagkaisa, should be the new frame in seeking amendments or replacement to the failed Electric Power Industry Reform Act or EPIRA.

The group made this challenge as some of its leaders attended the Department of Energy’s (DoE) consultations on EPIRA amendments while its members called for the law’s scrapping in a demonstration held outside the Legends Hotel in Mandaluyong City.

“A bad law like EPIRA may need some amendments to address the current mess. But a wrong policy such as wholesale privatization can only be addressed by replacing it with a new one, a better one,” stated Josua Mata, one of the convenors of Nagkaisa.

Mata, who is also the secretary general SENTRO, told the DoE that workers will engage the amendment process in Congress and at the same time work for its replacement when such is probable amid the incurability of EPIRA and the viability of other options.

Another convenor, Louie Corral of the Trade Union Congress of the Philippines (TUCP), said amendments are necessary on issues of cross-ownership; the generation being a ‘non-public’ utility, reforms in the ERC (composition and rate-setting methodology); privatization of the transmission system and the Agus-Pulangi hydro complexes in Mindanao; retail competition and open access; and on electric cooperatives, among others.

It can be recalled that in a petition letter submitted to President Aquino during the Labor Day celebration of 2012, Nagkaisa raised the following issues to the Executive, some of these require legislative actions:

1. Removal of oil and power from EVAT coverage; 
2. Stopping the indexation of/or pegging the prices of natural gas and geothermal steam to international prices of oil and coal; 
3. Stopping the ERC’s implementation of Performance Based Rate (PBR) methodology as this allows power firms to increase rates in anticipation of future expansion and other capital expenditures; and, 
4. Reforming the Energy Regulatory Commission (ERC).

The group also bats for the re-nationalization of the transmission lines and the permanent stay in the planned privatization of the Agus-Pulangi.

Partido ng Manggagawa spokesperson, Wilson Fortaleza, another convenor said the country and the people will not accept another 13 years of failed rule under EPIRA.

“It’s time to rethink and come up with a new model of public power that is completely different from what the industry is, before and under EPIRA. Fortunately we are blessed with so much national potential to do that. It is only the government that thinks it can’t be done without the prescribed track imposed by the ADB and World Bank,” said Fortaleza.

Workers ask Senate to declare EPIRA a failure

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With the committee on energy resuming its probe on the spike in Meralco rate today, the labor coalition Nagkaisa, pressed the Senate as a whole to declare the Electric Power Industry Reform Act (EPIRA) a failure and consider crafting a new policy framework for sustainable energy and energy democracy.

The group, which held another picket outside the Senate building, said that unless there is a declaration to that effect, public hearings and investigations will offer no material relief to consumers.

Nagkaisa explained that since 2008, consumer groups have attended, submitted position papers, and argued against the ills of EPIRA before committee hearings of both houses of Congress, including those conducted by the powerful Joint Congressional Power Committee (JCPC). Yet no actions were made to address those concerns.

“Public hearings end with another scheduled hearing then nothing happens until another controversy arises. Workers are really tired of wishy-washy intervention on a social problem of this scale,” Nagkaisa said, referring to the crises of escalating power rates and diminishing supply.

Nagkaisa asserted that since the enactment of EPIRA which led to the deregulation of the generation of generation sector, privatization of Napocor assets, creation of the spot market, and the introduction of performance-based regulation. Fraud became the norm in the power industry as shown by rising prices and cartelization.

The group reminded the Senate that in 2008, Senator Miriam Santiago who chaired the JCPC then stated in her opening remarks in one of JCPC’s public hearings that EPIRA is a failure; the Senate is a failure as well as the Executive.

“That is seven years ago and the people will not accept another decade of unrewarding probes to a mess that has been there since day one of the implementation of EPIRA,” said the group.

Nagkaisa has been protesting the power hikes which they believed were caused by flawed policies under EPIRA.

Workers to ‘gods of Faura’: Stop power firms’ blackmail, fraud

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While politicians and businessmen have joined President Aquino for the National Day of Prayer and Solidarity to the victims of natural and man-made calamities, workers in Metro Manila belonging to the labor coalition Nagkaisa, trooped to the Supreme Court to seek relief and ultimate deliverance from unjust power rate hikes.

The fifteen (15) justices, also known as ‘The gods of Faura’, were set to hear oral arguments tomorrow on several petitions seeking injunctions to Meralco’s P4.15/kWh rate increase. Prime in the agenda to resolve are questions on whether or not the Energy Regulatory Commission (ERC) committed grave abuse of discretion in approving Meralco rate hike; whether or not automatic rate adjustment is valid; and whether or not the generation sector is not a public utility and therefore beyond regulation by ERC, among others.

“We pray that the justices deliver us from a decade-old fraud and industry blackmail,” said Nagkaisa in a statement released during their picket at the gates of the Supreme Court building. The group was referring to frauds committed under the Electric Power Industry Reform Act (EPIRA), including the latest allegations on collusion and market abuse among power firms and the latter’s threat of rotating blackouts had they fail to collect rate increases.

Nagkaisa asserted that since the enactment of EPIRA which led to the deregulation of the generation of generation sector, privatization of Napocor assets, the creation of spot market, and the introduction of performance-based regulation, fraud became the norm in the power industry as shown by rising prices and cartelization.

“It is no secret that owners of power firms, the so-called Voltage 5 (Aboitiz, Lopez, San Miguel, Henry Sy, and Pangilinan) have been earning record high profits from record high tariffs of their power-related firms,” said Nagkaisa.

The labor coalition recalled that lowering the cost of power was the pledge of the Arroyo administration when it prodded Congress to pass the EPIRA upon assumption to power 13 years ago today.

Nagkaisa explained further that since 2008, many of its convenor groups have attended, submitted position papers, and argued against the ills of EPIRA before committee hearings of both houses of Congress, including those conducted by the powerful Joint Congressional Power Committee (JCPC). Yet no actions were made to address those concerns.

It likewise chided the Executive for peddling the line that the only choice for now is between expensive power, or having no power at all.

“We hope the Supreme Court brings light to a dark decade of power hikes, naked greed, and blackmail amid unreliability of power supply,” concluded Nagkaisa!

If Petilla can offer his head, why can’t Ducut and Ocampo do the same?

The news of Department of Energy (DoE) Secretary Jericho Petilla tendering his resignation in the wake of failure to meet his self-imposed deadline in bringing back electricity to areas ravaged by typhoon Yolanda is all over the air.  Whether the President will accept his resignation or not can be part of a ploy. But nevertheless, Petilla had the guts to place his head on the chopping board.

We wonder, however, if other inept officials in the energy family – particularly Energy Regulatory Commission (ERC) Chairperson Zenaida Ducut and Philippine Electricity Market Corporation (PEMC) head Mel Ocampo can do the same.

Petilla who heads the DoE is equally responsible for the government’s failure to stop the P4.15/kWh rate increase imposed by Meralco.  But Ducut and Ocampo who are in the frontline and supposed to be the first persons to detect market failure and protect consumers’ welfare stood idle before the coming tsunami of power hikes. They therefore should go.

Truth is, throughout their tenures, they have consistently failed to discharge their duties of regulating the power industry properly. The latest fiasco is just the culmination of years of ineptitude and incompetence.

As early as 2012, they were aware of scheduled maintenance shutdown and yet they did nothing to prevent the largest market failure in the power sector to date. In the process they unduly enriched Independent Power Producers (IPPs) to the tune of 10 billion pesos for a month’s worth of power outages!

They should go based on the principle of command responsibility. At the least, they allowed the electricity market to be gamed, and at the most, they are a party to the reported collusion among power firms.

Ducut and Ocampo should be investigated for possible charges of economic sabotage.

It’s also the time for the regime of Electric Power Industry Reform Act (EPIRA) to go.

– NAGKAISA! Statement