P7.11M solves Mindanao crisis

DIE HARD III
Herman Tiu Laurel
5/14/2012



Last May 9, state-run National Power Corp. (Napocor) completed its fast-tracked rehabilitation of the Pulangi IV hydroelectric plant in Bukidnon, allowing it to generate power to its installed capacity of 250 megawatts (MW) from half of that before.  That the rehabilitation was started only mid-April this year at the height of the Mindanao power crisis shows government's hurried response to the uproar from Mindanaoans who have suffered the crippling effects of the long blackouts--outages that were deemed deliberate.
 
As a result, Mindanao's economy suffered billions in losses, estimated by some to reach P60 billion, with government's Power Sector Assets and Liabilities Management (Psalm) Corp. claiming a loss of up to P15 billion.
 
To wit, the estimated power shortfall was anywhere between 100 to 150 MW.  The Pulangi rehab, meanwhile, costing only P7.11 million, has already restored at least 100 MW of installed electric capacity to Mindanao.  The question is, why didn't the Department of Energy (DoE) order this rehab earlier when this new administration took over in 2010?  Was it negligence or plain sabotage?
 
If Pulangi IV alone had been maintained properly at such a minimal cost early on, with the rest of the Agus-Pulangi system also rehabilitated two years prior, there would not have been any Mindanao power crisis to speak of.
 
Instead, what BS Aquino III, his DoE officials, as well as politicians such as Sen. Serge Osmeña have repeatedly claimed for the past two years was that a power crisis in Mindanao can only be solved by installing new coal-fired and other power plants.
 
Sen. Edgardo Angara, author of the RE (Renewable Energy) law in turn has repeatedly claimed that solar and wind power for Mindanao is the answer, hiding the fact that his RE law charges P20 per kilowatt-hour (kWh) for solar and wind, compared to hydro's P2/kWh.
 
In all, these officials are acting more as lobbyists, with Osmeña calling for the privatization of Agus-Pulangi and other hydroelectric resources on behalf of the oligarchs (such as the Lopezes, Aboitizes, Alcantaras, and Ayalas); with DoE officials siding with the coal and mining lobby; and with Angara rooting for his RE program in favor of foreign energy companies that would have to be in partnership with the usual suspects, i.e. the power oligarchs, who are already in RE projects.
 
What is made clear from these historical facts is that national policy on this matter has been ruled solely by lobby interests working through the entire political structure.  Not a single one of these officials have acted with responsibility and concern for the genuine interest of the people of Mindanao and the nation as a whole; thus, leading to the situation today that has produced the "highest power cost in Asia" devastating our industries and quality of life.
 
Last Saturday evening, on our Destiny Cable GNN program, Jojo Borja of Iligan Light and Power and lawyer Homobono Adaza reported on how the Energy Regulatory Commission (ERC) is again trying to pull a fast one on the public.
 
As we wrote in this space last week, they recounted how notices of a crucial ERC hearing on the case of the Maximum Allowable Price (MAP) petition of the Manila Electric Co. (Meralco) arrived suspiciously late--on a Sunday afternoon at legal counsel Adaza's residence, less than a day before the hearing, and, for petitioner Borja, on the Friday before the Monday hearing.
 
Despite the many underhanded moves, we're glad that the Meralco petition was postponed anew, saving the power firm's 6 million consumers from an early approval of a very onerous power rate base that is 100 percent over what the company should be charging for distribution.  The present rate, by the way, is based on what Borja says are several instances of Meralco equipment overpricing by as much as 900 percent!
 
Mang Naro Lualhati, octogenarian consumer activist, who works in cooperation with the team of Borja, Adaza, Butch Junia, Alan Paguia, Ferdie Pasion, and many others, laid the basis for the case that Borja and Adaza are now locking horns with Meralco over at the Court of Appeals (CA); thus, constraining the ERC from trying to resolve Meralco's petition in its sala at this time.
 
Furthermore, Lualhati has filed a motion for reconsideration on the ERC's dismissal of his opposition to Meralco's MAP of around P1.60/kWh, which, according to the accountant-oppositor--aided by Borja's facts, figures, and documents--should only be P0.90/kWh.
 
If Lualhati, Borja et al. will prevail in this epic struggle, they can win for Meralco customers as much as 50 percent of the distribution charges they pay, not including several more if other issues, such as the Performance Based Regulation scheme and its 17 percent rate of return vs the old Return-on-Rate Base's 12 percent, are eventually dealt with and overturned.
 
More importantly, another fact was highlighted in our program that should make everyone stop and take the predatory power victimization of millions of Filipinos very seriously.  Says Borja, "To this day, Iligan Light and Power is charging only P5.50/kWh retail on a customer base of 60,000 electricity connections while Meralco is charging P11 to P12/kWh on a customer base of 6 million electricity connections."
 
Whatever happened to the principle of "economies-of-scale," where the bigger the market and operation of an enterprise, the lower its prices for products and services should be?  Well, given that the scale of the losses from the Mindanao power crisis, amounting to billions of pesos, was solved by a mere P7.11-million rehab project, we should know that these power pirates are always up to no good.
 
(Tune in to 1098AM, dwAD, Sulo ng Pilipino/Radyo OpinYon, Monday to Friday, 5 to 6 p.m.; watch Destiny Cable GNN's HTL edition of Talk News TV, Saturdays, 8:15 to 9 p.m., with replay at 11:15 p.m., this May 12 on "Malampaya plunder" with Rep. Neri Colmenares; visit http://newkatipunero.blogspot.com for our articles plus TV and radio archives)

Vassal and suzerain

BACKBENCHER

Rod P. Kapunan

5/12-13/2012

The world knows the so-called "special relation" existing between the Philippines and the United States is one of a vassal and of a suzerain state. It has never been one between two sovereign states where the concept of national interest is pursued within the framework of what is mutually advantageous. It is from this context where Secretary of Foreign Affairs Albert del Rosario and Defense Secretary Voltaire Gazmin committed a serious diplomatic blunder. It now appears that their hasty mission to Washington D.C. was a pilgrimage made by the representatives of a vassal state to seek reassurance given the heightening tension with the rulers of the re-emerging Middle Kingdom.

Indeed, the pilgrimage turned out to be pathetic because they acted more like lackeys than as diplomats seeking to obtain reassurance from our current naval stand-off with China in the Scarborough Shoal or Panatag Shoal. They blindly equated our interest as equivalent to US interest, thus resulting in our being denied the right to invoke our alliance under the existing Mutual Defense Treaty. As emissaries of a vassal state, del Rosario and Gazmin failed to look back- that our alliance with the US was extracted from us in exchange for our alleged freedom, and not one we purposely sought in order to supplement our national interest brought about by our natural weakness as a state.

As one exacted from us after World War II, the US always had the upper hand on how to interpret the alliance, and that interpretation was always along the lines that would advance their interest.

To begin with, Secretary del Rosario should not have trumpeted the purpose of his homage, like issuing a statement saying his trip was "to seek a reaffirmation from the US of its commitment to come to the country's aid if shots were fired and Philippine sovereignty is threatened." It was a costly blunder because he and Gazmin failed to read that Philippine interest is not exactly parallel to that of the US interest in the region. Rather, the thrust of the US policy is to pursue further its ties with China than in defending a lackey state that has dared to embroil itself in some kind of jingoistic adventurism. Secretary of State Hillary Clinton was blunt when she said, "the United States would not take sides in the sovereignty disputes in the area, but as a Pacific Power it was in its interest to ensure freedom of navigation in the sea lanes in the region."

The two even failed to observe the basic diplomatic code of keeping one's mouth shut, or if not to sound out to their counterpart what should be stated in the joint communiqué after the meeting; that either the US make an official stand she is on our side as far as our standoff with China at the Panatag Shoal is concerned, or not to make any reference to the crisis and to our military alliance if the US is not prepared to give any unequivocal support to our claim. For our failure to make an advance feeler on what should have been stated in that joint communiqué, the US felt it was free to say anything, like declaring that it would not take sides on our current dispute with China. Invariably, that put our position stranded in the middle of the West Philippine Seas which was embarrassing, for we could not possibly order our small flotilla to leave the area without losing face.

For that faux pas, del Rosario now tries to salvage the blunder by putting up some qualifiers that we could still draw the US to our side. Secretary del Rosario now says the US will honor the MDT if the Philippines is attacked by China. That question in fact compelled Secretary Clinton to state she is not prepared to discuss any hypothetical questions, knowing that China is unlikely to attack the Philippines. Definitely, the US will not come to our defense.

Nevertheless, this column is not saying we have no valid and legitimate claim over those islands we now call the Panatag Shoal. The validity and legitimacy of our claim is geographical rather than historical because Panatag Shoal is just 124 nautical miles from Zambales, and is well within the 200-mile exclusive economic zone as defined and demarcated by the United Nations Convention on the Law of the Seas, while the disputed area is more than 250 nautical miles from the nearest Chinese territory. As signatory to the convention, China cannot now give its own arbitrary qualification to justify its hegemonistic expansionism that could reduce the area into a virtual Chinese lake. In fact, the US Air Force once used the area for their strafing and bombing practice when their facilities at Subic was still operational with China not lodging a single protest. Our claim is not based on ancient times when the whole of the known world was ruled by Genghis Khan, but in recent times when the Philippines, though the US, had a free hand in operating in that area.

• rodkap@yahoo.com.ph

Power rot

DIE HARD III

Herman Tiu Laurel

5/11/2012

"Meralco files plea for 2013 rate hike," newspapers announced this week. Former Misamis Oriental Gov. Homobono Adaza and Jojo Borja of Iligan Light and Power updated me on this latest attempt of the Energy Regulatory Commission (ERC) to pull a fast one on power consumers. This refers to the case filed against the Maximum Allowable Price (MAP) application of Meralco (Manila Electric Co.) before the ERC by octogenarian accountant and consumer advocate Mang Naro Lualhati — a case that is now filled with several anomalies.

First, the notice for the May 7 ERC hearing arrived anomalously late, at lawyer Adaza's residence on the Sunday afternoon just before Monday. Thus, Adaza had to call Borja to fly from Bukidnon, where the latter had just alighted, back to Cagayan de Oro and then Manila overnight to catch the next day's event.

At the ERC hearing, only a "hearing officer" presided. Upon arriving and entering his appearance, Adaza asked the "hearing officer" if he was "the" hearing officer. It turned out that the guy was only a clerk of court. Only after being informed that Adaza was there did the chairman of the ERC, Zenaida Ducut, suddenly decide to appear and preside — a basic legal requirement that has never been met in all past ERC hearings participated in collectively or separately by our advocacy groups.

Since the occasion was being used to formally accept so-called evidence that will buttress Meralco's MAP petition, it was an evidentiary hearing that, according Adaza, was illegal since Jojo Borja also had a pending petition at the Court of Appeals questioning the continuation of the proceedings until prejudicial questions were resolved.

Adaza and Borja would have missed the ERC hearing, with Meralco already laughing all the way to the bank, if the obviously and deliberately late arrival of the notice wasn't noted that Sunday. Adaza no longer made an issue of it as he had already averted the scheme. Still, he found the order for the hearing anomalous, as it was merely signed "for the ERC commissioners," even when the law states that such orders need to be signed by all commissioners — an anomaly regularly committed by the ERC, but this time, protested by Adaza — compelling the entire proceeding to be delayed for another five days.

As such, five million Meralco customers got a reprieve, thanks to Adaza, Borja and Lualhati (who wasn't able to attend due to physical infirmities).

But trust the ERC to continue frustrating consumer advocates' questioning and exposés of Meralco's predatory rate hikes.

Since 2003, Meralco and ERC have been having their way in running rings around, despite roadblocks placed by the Puno Supreme Court and the Commission on Audit. This time, they have finally met the determined team that will stop them.

When BS Aquino III stepped into Malacañang, the power oligarchs' noose tightened even more around the Supreme Court with the appointment of BS Aquino III's justices, including Justice Lourdes Sereno who has decided in favor of Meralco in the most crucial issue of rate increases and nitpicks on consumer protectionists.

Meanwhile, on the postponed Joint Congressional Power Commission (JCPC) meet that was supposed to be jointly chaired by Sen. Serge Osmeña and Rep. Dina Abad (who was conveniently out-of-town last April to avoid its convening), there is yet no official word as to when the shelved hearing is to be re-scheduled.

The latest reports from Mindanao say the power crisis there is getting worse. Brownouts are getting longer. The cause is supposedly the rehabilitation work being done at the Agus-Pulangi, which energy officials, particularly Department of Energy Secretary Rene Almendras, left undone for two years of the BS Aquino III government, despite calls from Mindanaoans in 2010 that it was desperately needed.

Clearly, the negligence was deliberate, as the delay of the rehabilitation directly led to the power shortfalls that created the power crisis there this season.

In the wake of Mindanao's electricity woes, government was compelled to call for a summit and schedule a convening of the JCPC. Amazingly, Mindanaoans were even blamed for this by PeNoy while the JCPC was indefinitely postponed due to a lack of quorum — this, as government losses due to the crisis have already reached P15 billion, with Mindanao's own economy experiencing losses of up to P60 billion.

The attitude and misdeeds of all those involved in the Philippine energy sector, private power companies and the agents they get appointed to government who are horrendously corrupt and rotten — promoting oligarchs' interests and their own "golden parachutes" — constitute a clear betrayal of the people.

How these people continue to hold on to their posts can only be explained by the complicity of the top appointing power and the corruption of money-based elections of this country.

In all sectors of the Philippine power elite, such betrayal of duty and rot is evident, as when the Senate cavalierly dismisses the plea to inhibit compromised judges; or when media practitioners irresponsibly report false information; or when police officials get involved in the murder of protected state witnesses, ad nausea.

(Tune in to 1098AM, dwAD, Sulo ng Pilipino/Radyo OpinYon, Monday to Friday, 5 to 6 p.m.; watch Destiny Cable GNN's HTL edition of Talk News TV, Saturdays, 8:15 to 9 p.m., with replay at 11:15 p.m., this May 12 on "Power, Manila, and Mindanao" with Bono Adaza, Al Tillah and Jojo Borja; visit http://newkatipunero.blogspot.com for our articles plus TV and radio archives)