ILP pay mode splits lawmakers

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THE House panel in the bicameral conference committee is not amenable to any changes in its version of a proposed joint resolution granting emergency powers to President Benigno Aquino 3rd to address a looming power crisis this summer.

Rep. Reynaldo Umali, head of the House bicameral delegation, on Wednesday said they will stand by their version particularly on how Interruptible Load Program (ILP) participants will be compensated for running their own generator sets (gensets) during tight supply.

Under the ILP, genset owners would be asked to deload from the Luzon Grid and to use their own gensets at certain hours.

In turn, the government shall reimburse owners of self-generating facilities (SGFs) for their fuel expenses in using their back-up generators during critical periods.


To compensate the ILP participants, the House proposed that the multibillion-peso Malampaya Fund be tapped by the government.

Its version of Joint Resolution 12 gives President Aquino the authority to source payment for the participants from the fund.

The Malampaya Fund was created by Presidential Decree (PD) 910 on March 22, 1975 for the sole purpose of financing energy exploration projects of the government.

Under PD 1234, the fund will be financed by royalties and rentals that the government collects from private proponents of energy exploration and development.

The Senate wants the ILP cost to be charged to consumers.

Sen. Sergio Osmeña 3rd, chairman of the Senate Committee on Energy, said the adoption of the ILP would cost consumers about P7 to P8 per kilowatt hour (kWh).

He said this is lower as compared to the P35 per kWh under a Department of Energy proposal to lease 300 megawatts in gensets at a cost of P6 billion for two years or P10 million per MW.

Umali said the payment for differential cost in the ILP is one of the contentious issues that still needs to be resolved by members of the bicameral committee.

He added that the House panel will push for its version in the belief that consumers should not bear the brunt of the possible power shortfall.

“We are not amenable to any changes, this is probably the best time for the government to prove that it is really for the people,” Umali told The Manila Times.

“We need to unburden the public of additional charges. They should not be faulted and penalized by the shortcomings of the government in addressing the power problem,” he added.

A day after the Senate passed its version of the joint resolution, the bicameral panel met on Tuesday to iron out its differences with the House version.

Umali and Osmeña said nothing has been agreed upon, particularly on the ILP subsidy and the time frame.

The committee will meet again on Monday.

Umali expressed hopes that they could reconcile the contentious issues and enact the resolution before Congress adjourns sine die.

The Philippine Independent Power Producers Association (PIPPA) supported the version of the Senate.

PIPPA president Luis Miguel Aboitiz said charging consumers may lead to less power consumption.

“The people will eventually pay for higher cost. Whether it’s from taxes or from directly in the bills, it’s an allocation issue. How they want to do it, it’s really up to them. Probably more appropriate to put it in electric bills. That way, people will be encouraged to consume less,” Aboitiz added.

Also senior vice president of Aboitiz Power Corp., he said it is important for the joint resolution to be passed in time for the March 16 start of the Malampaya natural gas platform’s maintenance shutdown.

The Department of Energy earlier said the Luzon Grid will be entering a critical stage in mid-March because of the shutdown of Malampaya.

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1 Comment

  1. I have always thought that those who will enrol for the ILP will be thinking of it as an opportunity to sacrifice a little of their enormous wealth to serve their poor fellow man and government should encourage them to do so after all their gensets will be servicing their own usage. I sense another conspiracy here to ripoff the poor with petilla wanting emergency powers from the start for pnoy and failing that he was asking for a big amount from congress allegedly for paying the ILP volunteers and here comes aboitis saying that the costs of the program be charged to consumers to encourage them to use lesser electricity what nonsense knowing that the poor consumers are using minimum power already. Why I ask should the poor consumers be penalized for what is essentially government failure to address this shortage of power that has been looming since these nincompoops came to power.