Congress urged to investigate unplanned power plant shutdown

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The Department of Energy (DOE) is looking into the possibility of collusion among power generators and suppliers as the Manila Electric Co. (Meralco) is set to implement big-time power rate hike this month.

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DOE Undersecretary Raul Aguilos said during the House Committee on Energy meeting on Tuesday that the simultaneous, unplanned shutdown and outages of power plants that was supposed to continuously supply electricity to Meralco raised the possibility of collusion among the power producers to increase the electricity rates in the wholesale electricity spot market (WESM).

“These were actually the major reasons, factors, why such a spike happened, because these were not anticipated,” Aguilos said.

“That’s why the secretary would want this investigated to identify the culprits and make penalize them if ever that’s why we also have to seek the assistance from PEMC [Philippine Electric Market Corp.] and ERC [Energy Regulatory Commission] because this is also part of their mandate so this is an ongoing process which we would like to be finished within the timetable, within the reasonable period of time.

ERC Commissioner Josefine Patricia Asirit also said that it is compelling for the government to investigate the unplanned shutdown, whether there are really defects, leaks, or malfunction in power plants.

“But what is more compelling is to be able to investigate the unplanned or those that were not scheduled,” Asirit said. “I do understand that the DOE has a mechanism to be able to address and even to visit the different plants that have been on unplanned or forced outages.”

According to Meralco’s report presented to the committee, there are at least nine power plants that went on scheduled but extended shutdown and forced outages. These include: Sual, GN Power 2, Sta. Rita Module 20, Sta. Rita Module 30, Ilijan 2, QPPL, Sual 1, Calaca 1, and Masinloc 1.

If these plants did not shut down or extended its scheduled outages, the price increase would only be at P1.58 per kilowatt-hour (kWh). The rate approved by the ERC on Monday is at P4.15 per (kWh) on a staggered basis: P2 this month, P1 in February and P.44 in March.

Meralco COO Oscar Reyes said that the company is still undecided whether they will implement another rate increase in April to make up for the value-added tax (VAT).

Power cartel

ACT Teachers Party-list Rep. Antonio Tinio hit the government’s failure to regulate the power rates, especially when the electricity purchased from WESM comprise a mere 11.5 percent of Meralco’s overall electrity distributed to consumers.

“This seemingly absurd situation points to a massive failure on the part government, particularly the [ERC], to regulate and protect the public from the predatory behavior of a handful of power producers, who were able to dictate the price of electricity sold in the WESM.

According to Tinio, there are only three power producers that were able to dictate the price of electricity in the spot market, including Aboitiz-owned Therma Mobile, the Bauang Diesel Power Plant, likewise operated by the Aboitiz group, and the Limay

Combined Cycle Plant owned by Millennium Holdings, Inc. of businessman Mike Valencia.

Before the Malampaya shutdown, the average rate in the WESM is only at P13.74 per kWh but it soared to P33.22 per kWh. JHOANNA BALLARAN

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