Consumer group opposes the hiring of foreign consultants by the government

Press Release by
NASECORE
December 28, 2005

PARAÑAQUE CITY  – The National Association of Electricity Consumers for Reforms, Inc. (Nasecore) today questioned the wisdom of the government in the hiring of foreign consultants in the privatization of the National Power Corporation which is part of the restructuring of the electricity industry.

This was the reaction of the consumer watchdog to reports that the Asian Development Bank (ADB) has allowed the Power Sector Assets and Liabilities Management Corp. (PSALM) to hire British Power International (BPI) to handle the contracts of the National Power Corporation (Napocor) with its independent power producers (IPPs).

BPI was hired to advise PSALM and Napocor in the appointment of IPP administrators (IPPAs) that will be done through competitive bidding as mandated by the Electric Power Industry Reform Act (EPIRA).

“Hiring of foreign consultants is an insult to local experts and a big drain to the coffers of the government as they will not be paid a pittance. This is a manifestation of how our government is controlled and dictated by foreign lending institutions,” Pete Ilagan, president of Nasecore, lamented.

“How much will the Filipino people pay for this foreign consultant and the other consultants who were previously hired to help the government in the implementation of EPIRA?”, Ilagan queried.

The consumer group is also concerned about the cost in the appointment of IPPAs who will administer, conserve and manage the contracted energy output of Napocor IPP contracts fearing that these costs will simply be passed-on to the rates that consumers will pay raising further the prices of electricity.

The IPPs contracted by Napocor are already managed by the companies that set up the generating plants. The appointment of IPPAs will be an additional administrative layer that will raise the cost of operating the IPPs.