The real plunder issue

DIE HARD III
Herman Tiu Laurel
7/11/2007



While fireworks over Gloria’s conviction of Erap boils over, a really massive plunder is going on: ever increasing rates of the already highest power rate in Asia, pushed by the financial and energy oligarchs– with the mainstream media and columnists in cahoots to keep the truth from the people. In a very real sense, Philippine politics is distraction built into the prevailing system to distract from the issues that really affect the quality of life of every Filipino, their economic productivity and competitiveness, and the future of the country’s security and development.

A recent Japanese study comparing power rates in Asia reported that power costs $0.06/kwh in Thailand to $0.10 in the Philippines, a full 40% higher; my Tsinoy friends in Shanghai report P 4/kwh there compared to our P 9/kwh here average. At the core of the power plunder now is the WESM and its board, the Philippine Electricity Market Corp. with the electricity generators, distributors, cooperatives and the ERC; but the past two weeks we read at least seven columnists pick up the electricity issue not to take the denounce the high rates to obfuscate issues.

A campaign to throw illusory blame on the electricity consumer protection organization Nasecore (National Association of Electricity Consumers for Reforms), was underway (like the campaign against Trillanes) alleging it was and is pro-Napocor – a absolutely false charge based on lies from Meralco PRs, the ERC and other power pirates whose standard strategy is to confuse the public into exasperated acquiescence or apathy. The fact is, Nasecor has never failed to oppose unjustified rate hike petitions from NPC or any other power generating, regulatory or distribution entities.

In 2004 Nasecore proposed the P 1.22/kwh increase on the basis of its claims of losses due to its debts and other factors, Nasecore petitioned the ERC to deny it; but Albano’s ERC invariably take the side of rate increases. Recently, ERC’s Albano issued an irked press release against Pete Ilagan due to press reports that “ERC is protector of Meralco” which did not come from Nasecore but from reporters who are less constrained to speak the truth.

The rash of anti-Nasecore tirades came as Nasecore opposed Meralco’s P 2.5-B “cost-recovery” petition and demanding it refund the consumers, showing incontrovertibly that Meralco committed “erroneous collection” in November and December 2006 ruled by the ERC in case number 2006-052RC and January and February 2007 in case number 2006-062RC. Meralco feared its stock prices would fall and scuttle the Union Fenoza shares sale capitalizing on unprecedented high Meralco stock prices (no on alleged losses) due to the profits it is bilking from the consumers.

The continuing deception and plunder of the people involves several factions of energy pirates: the multi-lateral and local financial sharks behind every energy project, fuel suppliers (ex. Malampaya’s Royal-Dutch Shell), generating companies (IPPs), distribution companies (mainly Meralco controlling 74% of Luzon, 66% of entire country), government bureaucrats (Gloria, NPC, ERC, Psalm, TRANCO executives), the Big Business groups (like Makati Business Club - MBC) and the electric cooperative mafia - conspiring to take larger and larger portions of flesh from electricity consumers.

Since 2006 all these factions came together in one great hoax – the Wholesale Electricity Spot Market (WESM) where bidding for electricity is supposed to ensure free competition – yet, as soon as it opened a scandal of “price manipulation” by NPC and Psalm immediately surfaced after Gloria’s instruction for NPC to take losses bring down rates to prettify WESM’s image (to the satisfaction of its promoters like the AmCham, MBC and Peter Wallace) and brought WESM rates in July P 5.21/kwh to P4.42/kwh in August, but in October it went to P 7.10/kwh, Nov. 9.42 and 2007 January P 10.76/kph.

WESM rates fluctuate, but there is no transparency in its bidding prices; nobody but the WESM Board knows what the power generating companies submit as price bids, and the “market clearing price”- whatever is the last rate offered that would met the remaining demand. There is no public showing of this bidding, only the WESM board knows, composed of the very pirates themselves – the groups in the above paragraph who conspired to design this spot market that is opaque and inaccessible to the public – the biggest swindle we have ever seen.

WESM board members consists of the participant utilities and not the public – the Philippine Electricty Market Corp. (PEMC), Dept. of Energy, Meralco and Phil. Independent Power Producers Association (led by Meralco), the Psalm, two other private distributors, two electric cooperatives, two Export Processing Zone Areas, one from the SEPI, representative of bulk buyers and the Institute of Electrical Engineering (impoverished academics the easiest to co-opt, remember the U.P.’s Viray under FVR?), but no consumer representation and no public transparency.

There’s a “market surveillance committee” which is essentially the same, with characters like the IPP agent Peter Wallace and some college deans (as we said, the easiest to co-opt), but no consumer representative with track record and credible public credentials. Last Monday the ERC, tasked to investigate the WESM price manipulations cleared NPC and Psalm and Albano issued a “stern warning” (hahahaha), and consumers will again be slapped P 3.00/kwh total addition for the Meralco to recover from price manipulation that never happened (more hahahaha). It hurts whether I cry or laugh.

(Tune in to 1098AM, M-W-F, 6-7pm)