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By Euan Paulo C. Añonuevo, Reporter
After just recently surviving a grueling
challenge to its control of giant utility Manila Electric Co. (Meralco),
the Lopez Group has found itself besieged in several fronts.
Salvos are coming from the Government Service
Insurance System (GSIS), the state-pension fund; Congress; the
state-owned National Power Corp.; the Securities and Exchange
Commission (SEC); and a consumer group. Now, even a labor group has
joined the fray.
Winston Garcia, GSIS president and general
manager, said Friday he would move for the cancellation of the more
than P1-trillion contract between the Lopez-controlled Meralco and
the Lopez-owned independent power producer First Gen Corp.
“This [contract] is the mother of all
sweetheart deals, which has to be rescinded if we are to stop the
Lopezes of Meralco from saddling us with unconscionably high power
rates,” he said.
First Gen, the country’s largest private power
producer, controls the 1,000-megawatt Sta. Rita natural gas plant,
which has been singled out by a number of lawmakers for allegedly
having been paid by Meralco for undelivered electricity—a practice
that is common in the power sector under “take or pay” contracts
of power producers.
“Take or pay” is similar to amortizations
that an individual enters into when buying a car or a house. Whether
the person uses the car or house, he is tied to paying a monthly
amortization.
Garcia said the contract between Meralco and
First Gen was void at the very start, because it was sealed in
violation of the terms of the utility’s franchise to provide
electricity to its captive market at the least cost to consumers.
Napocor said in a statement that its rates are
cheaper than First Gen’s natural gas-fired power plants, whose
promise of “being able to lower electricity rates” is yet to be
seen.
Garcia, who has been very vocal of his desire to
wrest Meralco from the Lopez family’s clout, said the excesses of
the Lopezes and their mismanagement of the utility have burdened
consumers with one of the world’s highest power rates.
The GSIS chief’s bid to take control of the
country’s largest distribution utility failed in Meralco’s board
election on Tuesday, when Lopez nominees registered as the five
highest vote-getters from the company’s shareholders, winning
majority control of the company’s 11-seat board.
The government pension fund and its allied
groups took four while independent directors were assigned two
seats.
But the Lopez Group’s recently reaffirmed
control of Meralco is being questioned by the SEC, which has asked
the utility to explain why they should not be declared in contempt
for ignoring its order, which was solicited by Garcia, to stop the
counting of proxies in favor of pro-Lopez directors during the
election.
The latest group to assail Meralco was the
National Labor Union.
The labor union also on Friday decried the
“arrogance [of the Lopez Group in Meralco] by placing [itself]
above the law” in refusing to abide by the SEC restraining order.
(See related front-page story.)
On Thursday, the National Association of
Electricity Consumers for Reforms also expressed support for Garcia,
who “exposed a series of anomalies involving the management by the
Lopez family of Meralco.”
“Who will protect us, the lowly customers?”
asked Pete Ilagan, the association’s president. “We hope that
Mr. Garcia would pursue the fight, exhaust all legal options to
correct all forms of Meralco mismanagement, and bring down power
rates.”
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