ERC forced to do its duty

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The Energy Regulatory Commission (ERC) has at last done its job—its duty—to protect the public from abuses of the players in our country’s power industry. But it was forced to do so.

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In almost daily front page new reports and well-researched expose articles by columnist Rigoberto Tiglao these past months we have detailed the profit-making acts of the companies generating electric power and of the Manila Electric Company. Meralco is the monopoly that controls the distribution of electricity to businesses, factories, offices, schools, churches and households in Metro Manila and environs.

Their excessive profit-making proclivities, we have been contending, have hurt business and industrial growth in our country. These proclivities make the price of power so costly that electricity in our country is among the most expensive in the world.

This makes foreign investors—those that invest in countries outside their own to open businesses and manufacturing plants—shun the Philippines. Meanwhile, they locate their businesses and manufacturing operations in our neighbor countries. If we had more foreign businesses and factories here, there would have been millions more jobs for Filipinos. Our unemployment rate would have been much less than 7.1 % in January 2014 and we would have had less than 2.969 million (or almost 3 million jobless people). These figures are from the government’s Philippine Statistics Authority, which said the latest figures represent an increase of jobless Filipinos to 7.5% from only 7.1% in January last year.

The very high cost of electricity, by hindering foreign and even domestic investments in job-creating businesses, contributes to our country’s massive poverty situation.

The ERC, for all the complexity of the EPIRA Law that governs its existence and functions, in essence has the responsibility and mission of making the power situation in our country more efficient and profitable for investors in generation and distribution while ensuring that the cost—and absence–of power do not become deterrents to growth and development.

But instead of doing their job, the ERC commissioners have allowed the situation to reach the crisis point.

And it actually approved the increase in power rates sought by the Manila Electric Company last December. The rate hike was P4.15 per kilowatt hour. That increase immediately doubled for some Meralco customers their electric consumption bill.

The rate hike, Meralco, ERC and the Aquino administration were roundly condemned by Meralco customers and most of the Philippine media, and more vigorously than others The Manila Times.

Meralco tried to justify the rate hike with the shortage caused by the almost simultaneous closure of nine major generating plants. Experts saw collusion among Meralco and its sources of the power it resells. The ERC commissioners did not notice anything, or if they did, they were willing to ride along with the flow dictated by Meralco and the generators.

Concerned groups immediately took Meralco, the ERC and others to the Supreme Court. The High Court wisely halted the implementation of the rate increase with a temporary restraining order that, we pray, will be made permanent.

Because of the public condemnation of what was clearly an abominable rate increase orchestrated by the biggest power industry players, the Aquino administration seems to have pressured the ERC commissioners to revoke their approval of the rate hike.

The Energy department must also be blamed for the whole mess.

We the people are being fooled by the Aquino administration into believing that the ERC has seen the light at last and found that something terribly wrong was happening at the Wholesale Electricity Spot Market (WESM) during the shutdown of the Malampaya gas pipeline and other plants in November that made the Meralco rate hikes seem “reasonable, rational and competitive” to the commissioners.

The investigation must continue on the culpability of the Meralco and the other players for the mess.

And the ERC commissioners must account for their, we believe, criminal immediate approval of the Meralco-sought increase.

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4 Comments

  1. 100 % correct. If not for pressure from the Manila Times and others, the ERC would have just left things alone. After all they had already approved the increase in days(?). Now 4 months later the are forced to act and reverse the approval. So if they were not caught gaming the system, they would never have done the correct thing. I think we Filipinos have slid into a Financial Dictatorship. Money has become the most important thing and doing your job honestly is never a thought when it interferes with the money. Manila Times you keep doing the right thing. Force them to do their duty and let’s get some of them in jail.

  2. Anima A. Agrava on

    You are absoluterly correct, Manila Times.
    The ERC has acted criminally in:
    (1) neglecting to act on the looming power crisis, wich years ago, even Mr. Oscar Lopez, patriarch after the death of Geni Lopez of the Lopez clan, that new generating units and power generation system must be built at once to forestall brownouts caused by supply shortages.
    (2) Going along with the greedy and profit-only minded owners of Meralco and the generating companies.
    (3) Letting the WESM, PSALM, Meralco do what they want to happen instead of creating a truly market-driven power market.
    Government officials, like soldiers who refuse to fight the enemy, should be punished. They should not only be punished for receiving bribes (which can be heard to prove) but also for failing or refusing to do their duty. That is clearly criminal, specially when the economy is harmed, the people are made to suffer and development is thwarted by their inaction and incompetence (which can actually have a corrupt motive).

  3. WAS IT NOT MALACANANG WHO SPOKESMEN WHO SAID THAT MERALCO’S PRICE HIKE WAS NORMAL AND FARE EVEN BEFORE ERC APPROVED IT? NGAYON NAGPAPALUSOT NANAMAN SILA SA MGA KAPALPAKAN NILA. MR. LACIERDA, MR. COLOMA AT M/S VALTE, REVIEW NYO NGA ANG MGA SINABI NYO NUON BAGO NAG ALMA ANG MGA CONSUMERS AT DINALA NA ITONG USAPIN NITO SA SUPREME COURT. SA AKIN LANG, ANG BAYAN MUNA AT IBANG PATYLUSTS LAMANG ANG NAG PROPROTEKTA SA BAYAN. ANG IBANG PARTIDO GAYA NG LP, NP, PDP, NPC, UNA AY PURO INUTIL, DI BA HO?

  4. U hit d nail right on Ducut’s head and those ilks like her.They should b held liable criminally .We Filipinos have been held at ransom by such senseless appointees.Cheers to Mr.Tiglao for his indepth articles pertaining to such anomalies/deceitful tactics by meralco,PLDT,Salim group of companies……