The P7-billion debt that the government accumulated in the 1990s after it intervened in power generation is fueling Congress’ resistance to granting President Benigno Aquino 3rd emergency powers.
Rep. Ben Evardone of Eastern Samar, a member of the Joint Congressional Power Commission, made the disclosure on Tuesday in connection with a move of the House of Representatives to inquire into the expected power shortfall in the summer of 2015 instead of granting outright the President such powers.
Evardone said ghosts of government contracts with Independent Power Producers (IPPs) during the Ramos administration that led to massive brownouts were too horrific as to be easily forgotten.
A review of the IPPs during the Arroyo administration revealed that only six of the 48 IPPs that entered into a contract with government complied with their obligations in generating power.
The rest of the IPPs were paid by the government in fixed rates but miserably failed to generate the expected power supply, resulting in the P7-billion debt for the state and skyrocketing power rates.
“The proposal right now is to lease additional power barges. Well, it is virtually the same as what happened with the IPPs. How can we be sure that there won’t be a repetition of what happened in the 1990s? That is the issue that Secretary Petilla needs to hurdle,” Evardone told The Manila Times, referring to Energy Secretary Jericho Petilla.
Petilla has said there will be seven to eight-hour daily rotating brownouts every week by summer if the government fails to secure additional 800 to 1,200 megawatts of power supply.
In securing additional power supply, the government has three options: implement a mandatory Interruptible Load Program or the ILP (a scheme wherein malls and big companies with large standby generation capacity will not get power supply from power plants and instead run their generators); lease power generating sets for P6 billion in two years; or purchase such sets for as much as P10 billion.
Petilla favors the leasing option because of greater government control and security of the available power supply that would be available, considering that making ILP participation mandatory can scare businesses.
Evardone, however, said Congress remains skeptical about such “government control” because of the IPP crisis, on top of the P6-billion lease.