• Currently unraveling: The state’s utter bungling of the power sector

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    In the world’s largest economy, contemporary voters prefer to elect state governors as presidents because of one obvious reason – capitols are known to be founts of dynamic leadership and bold, fresh ideas. Jimmy Carter, Roland Reagan, Bill Clinton and George W. Bush all trained at state capitols and from there plotted their ascent to the White House.

    So when President Aquino named former Leyte Governor Jericho Petilla as energy secretary, there was this hope that Petilla would bring into the Aquino Cabinet the following: fresh insights, bold and fresh ideas and dynamic leadership. The fact that Eastern Visayas is a geothermal power made people assume that Petilla had solid grounding on energy and power issues.

    Wrong. very wrong.

    Petilla will go down in the chronicles of the power/energy sector as the secretary who raised the bogus scare that “rotating brownouts” would cripple households and industries for at least seven hours a day in the summer of 2015. And that the power failures would be the “new normal.” And proposed this hare-brained solution: President Aquino should get emergency powers from Congress to deal with that coming summer nightmare.

    And how would Mr. Aquino use that emergency power? Petilla’s DOE had this proposal that could perfectly come from an electricity lineman getting the minimum wage: use public funds to lease or buy generator sets. In DOE’s version, however, it would not be loose change from the national budget. It would be anywhere from P6 billion to P10 billion. Just imagine what P6 billion can do to help the DOH prepare against Ebola.

    Congress, in an act of tender mercy to the country, has reached the consensus that any grant of emergency powers to the president will strike out the proposal on the leasing and buying of generator sets. The emergency powers—in case Congress votes to grant the president just that —would be about fast-tracking power projects, smoothening the process of interconnections and managing the demand side of power.

    Congress found out – to its utter dismay and frustration – that Petilla and the DOE can’t do good policy and can’t do the math. In congressional hearings, it found out that in the summer of 2015, the worst-case scenario would be a 31 MW shortage, which industry experts said would have this impact: a one-hour-a-week rotating blackout. The horrific nightmare Petilla painted was a supply shortfall of anywhere from 900 MW to 1,200 MW in the summer of 2015, a scary scenario indeed but a bogus one.

    Why did Petilla inflate his numbers? The only clear reason is to push the president into using P6 billion to P10 billion to lease or buy generator sets.

    That the DOE and Petilla have a “genset mentality” and have been epic failures in crafting and executing good policy are the factors that pushed the House committee on energy to reach this consensus – limit the emergency powers that may be granted to President Aquino. The House was very specific on this: facilitating power projects.

    The context of this House consensus is tragically familiar. Some vital power projects – which could instantly bring relief to the power sector — have been tied up by reasons both silly and phony. Maybe the president can use his power of suasion to ease the baseless judicial/regulatory messes they are in.

    Prime example. The Luzon grid, which powers the economic and political centers of the country, was to have an additional supply of 600 MW next year. RP Energy, a consortium of the country’s biggest names in power generation and its foreign partners, was to inaugurate in early 2015 a 600 MW power plant at the Subic economic zone using what it calls the “clean coal technology.”

    You know what? A petition by phony environmentalists – based on a template drawn from the Web – asked the Court of Appeals (and later the Supreme Court ) to stop the 600 MW project for supposed lofty environmental reasons. The courts heeded the Web-sourced petition, which cleverly adopted the high-sounding nomenclature Writ of Kalikasan.

    The sad result – a $1.2 billion power plant investment ready to produce 600 MW next year but tied up by the courts.

    The House committee on energy and the senators may have also found out the utter trickery in the proposal to use P6 billion to P10 billion to buy or lease generator sets. The gensets are already here – only they are owned by the private sector.

    The major users of electricity – from the malls to the industries – have back-up generator sets. Many of them, from the Sys to the Ayalas, have reached an agreement with the Meralco. They can disengage from the Meralco-supplied power to use their own gensets during supply shortages.

    According to news reports, 27 firms have agreed to use their own gensets during power shortfalls and Meralco is negotiating with dozens more.

    As senators and congressmen dig deep into the woes of the power sector, it turns out that the main problems of Petilla and the DOE are these: laziness, lack of fresh ideas and, the failure to grasp the bold actions that are required to prop up the power supply. The worst? The predisposition to concoct bogus scenarios to justify the most tortured phrase in governance—emergency powers.

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    5 Comments

    1. Just like under this BS’s mother’s administration, the bungling is deliberate and the motive is to rip off Juan de la Cruz to create mega profits for the oligarchs and their foreign partners. The problem is with the yellow regime, not only with BS, Petilla and company. As long as we are under the sway of this predatory regime, you can consume all the printers ink in the world and nothing will change.

    2. The emergency power needed by Aquino is the power required to jump start his brain. This power should contain an automatic provision to remove all Aquino appointed or promoted officials from office.

    3. Petilla is either totally incompetent or as I suspect cooking up something to rob us blind with the amounts the emergency powers are poised to spend for leasing worse buy gensets. Somebody is going to make a killing again can’t everybody see how senseless it is spending for gensets that we may not use at all or use sparingly for a hort time only. Pnoy even proudly says it is better to have something and not need it than to need something and not have it. If he thinks he uttered a brilliant saying he is utterly wrong it is nothing but a flip-floping statement of a “tukmol”.

    4. according to the grapevine mr ronquillo, i hope you have this also, the target is really the billions in malampaya funds to be source of fund raising of the lp. mukhang gustong bilin ang eleksyon. sa dami na ng pera nila from the lump sum allocations in the budget, the pcso and the pagcor funds, eto pa at gustong tirahin ang malampaya funds.

    5. Are we going to repeat again the evils this emergency powers congress before gave to Ramos? These PPAs and IPPs were the very ingredients that brought our electricity rates one of the highest in the world because of the stupid administrations of Cory Aquino and Fidel Ramos. Are we going to experience again for the second time this evil scheme of a bungling and incompetent Aquino Administration? Please people of the Philippines, let’s be wary and vigilant, most of Aquino’s allies in Congress again will look for justification so to cater to the whims of incompetent Aquino and will grant him emergency powers full of loopholes like they did with EPIRA Law so they could get money for the war chest of Liberal Party, that’s their agenda, period, and nothing else.