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TUCP slams Petilla for inutility on brownouts, world class rates; proposes declaration of national emergency on power to address problem once and for all

July 12, 2014

QUEZON CITY – The Trade Union Congress of the Philippines (TUCP) chided Energy Secretary Petilla for his being inability to address brownouts and increasing electricity rates.

The group, instead, proposes a declaration of national emergency on power so that the country will cease being a victim of the vicious cycle.

TUCP described the “red alert” status issued by the Department of Energy, warning as to insufficient supply this weekend as the tip of the iceberg.

“Our ship-of-state is sailing full speed ahead, in a collision course with the twin -peak iceberg of lack of power and MERALCO’s never-ending price increases. The DOE is placing our economic take-off at risk and is setting the stage for an impending economic meltdown,” said TUCP Executive Director Luis Corral.

“The TUCP requests that the DOE Secretary to call a spade a spade and advice President Aquino that there is now an emergency in the power sector, requiring a multi-agency response with clear directions from the President, “said Corral.

The labor center in a two-hour audience with President Aquino this April 30 requested the President to declare an emergency and establish a multi-agency group under him to address the power crisis. The DOE instead set up a task force study group which the TUCP and labor coalition Nagkaisa.

Corral laid the responsibility with the DOE for not laying down clear policy parameters and accompanying strategies to ensure secure power supply or to define competitive rates.

“The DOE doesn’t have these two items which can be technically defined by engineers, financial analysts and industry practitioners. In the absence of crisis leadership, electric power policy is veering from one Supreme Court case, still unresolved, to a new Supreme Court case, from ERC caps on a supposedly free-market activity to a more complex two price-cap mechanism and now to a pitiful DOE Task Force on Power Rates whose arcane and complex debates are further obscuring one central fact: That power Philippine Power Policy is in this climate of drift is firmly in the hands of a socially irresponsible and financially greedy power generation sector,” he explained.

In the midst of this, consumers are supposed to rely on the oversight of an Energy Regulatory Commission headed by the Napoles-challenged Zeny Ducut,” said TUCP spokesperson Alan Tanjusay.

“While there is a lack of secure and reliable supply, government should step in to put up additional capacity. If bilateral contracts between power distributors and generators will better lower rates and approximate true costs, then suspend the WESM until a technically developed percentage of supply reserve is set up to engender real competition. If there is cheap hydropower available during the rainy season, then run it instead of keeping it as ancillary reserve while the more expensive coal and oil plants are run,” Tanjusay said.

He said this can be done without need of amending EPIRA,” All it takes is Presidential courage to announce an emergency and the need for a national response. Then all the players can be prodded, cajoled and otherwise mobilized to restore sanity to the electricity industry."

The TUCP also called for an end to “blue skies” wishful thinking that somehow the DOE target to increase solar from 50 Megawatts to 500 Megawatts, will ease the burden of the supply deficit.

Solar has at best an efficiency capacity at best of 20%, 500 MW really means 100 MW and that will never be large enough or reliable enough to be base load for large industries. Also, this will be done with a feed-in-tariff that will jack up rates by an average of 18 centavos per kWh for the next 20 years.

"Solar seems to be the flavor of the month, Two years ago the flavor was privatizing the power barges and last year it was pushing generation sets. In Mindanao DOE could have rehabilitated the Agus Pulangui hydro-electric complex as demanded by Mindanawons, they did not , so the UP experts are predicting 200 plus days of brownouts for Mindanao next year. In the meantime the DOE rushed implementation of the Retail Competition and Open Access program which we fear will further drive up rates for the captive residential households of MERALCO,” Corral added.

TUCP attributes the deflated 5.9% GDP growth rate in the first quarter as being driven by insecurity of businesses in our power supply. TUCP also attributed the inflation rate of 4.7% in May, the highest in 30 months, on the spiraling cost of power. They said energy officials preen with confidence about the manageability of our power crisis and yet we are made to pay for their failure of political leadership.

The labor group said the country is hit by the triple whammy of spiraling costs of goods and commodities, an interruptible load program that allows Robinson's and SM to power up their generators to energize the lights and air-conditioning of their malls when there are NCR brownouts and be able to charge it to MERALCO customers, and now the real threat of retrenchments because businesses are losing because of no power and high power costs.

TUCP has warned that the ASEAN Integration come 2015 requires a clear energy roadmap. "A wrong-headed energy roadmap will be fatal to all other industry roadmaps. If there is no power, there will be no investors and there will be no jobs," Tanjusay said.