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By Euan Paulo C. Añonuevo, Reporter
The word war between the Lopez Group and Winston
Garcia appears to be headed to a showdown during Tuesday’s annual
stockholders’ meeting of the Manila Electric Company (Meralco).
The Lopez Group has controlling share of the
utility firm, while Garcia, head of the state pension fund
Government Service Insurance System (GSIS), is bent on securing
controlling stake in Meralco under the battle cry of “lowering the
country’s power rates.”
Tuesday’s meeting at Meralco’s main building
in Pasig City is poised to serve as the battleground for the
boardroom showdown that has spilled over to media, Congress and the
power sector.
Garcia has been publicly lambasting the Lopez
Group for mismanaging Meralco at the expense of consumers. He sits
on the utility’s board in lieu of GSIS’ 23-percent stake in the
company.
He also holds the proxy votes of other
government financial institutions, which includes GSIS, whose total
stake in Meralco is about the same level as that of the Lopez
Group’s 33.4-percent shareholdings.
The GSIS chief earlier said government is out to
consolidate its bloc in the Meralco board in an effort to bring down
the country’s high power rates, which is second only to Japan in
the region.
If government succeeds in putting a new
management team in Meralco, consumers would see “a reduction in
electricity rates of at least P2 per kilowatt-hour within the next
two months,” Garcia claimed.
But he has yet to give a detailed plan as to how
he or the government plans to go about this should they gain control
of the Meralco management, saying only that the utility’s
officials “have been caught several times over cheating, abusing
and shortchanging the public.”
Estrellita Elamparo, GSIS spokesman, said even
if the government does not wrest control of the Meralco management,
it will look into the “onerous contracts” entered into by the
Lopezes with its other companies, which they are blaming for
Meralco’s high power rates.
Lopez-controlled power generating firm First Gen
Corp. makes up bulk of Meralco’s contracted private power
producers, which account for about half of the power it distributes
to its customers in Metro Manila and outlying provinces.
“We are not aiming for majority control,”
she said. “We are aiming to institute changes in the Meralco
board, and that is one of the things we will do, look into those
onerous contracts,”
The Lopez Group—which has interests in power
generation, real estate, manufacturing and utilities—has dodged
allegations by the government that they are responsible for the
country’s largest power utility’s high rates. Taxes and
royalties imposed on electricity charges and indigenous energy
sources should be the ones scrapped and not them, the group said.
“It’s a big step in bringing down the
rates,” said Oscar Lopez, the group’s chairman.
Industry sources said removing the royalties as
well as value-added tax on electricity will redound to a reduction
of P0.50 per kilowatt-hour and P0.75 per kilowatt-hour,
respectively, for a total of about P1.25-per kilowatt-hour cut in
consumers’ electricity bills.
Government financial institutions have four
seats on the 11-seat Meralco board. The Lopezes have five, and
independent directors, two.
Should Garcia muster enough votes in Meralco’s
stockholders’ meeting, the Lopezes will lose their foothold in the
utility’s management for the second time since martial law.
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