Business World Online
by Lenie Lectura - July 23, 2015
FORMER Energy Secretary Rafael Perpetuo M. Lotilla on Thursday stressed the importance of placing the Energy Regulatory Commission (ERC) under the Department of Energy (DOE) as a way to enhance and institutionalize their coordination.
During the Ayala-University of the Philippines School of Economics (UPSE) Economic Forum on Challenges of Governance in the Power Sector, Lotilla said it is not right to place the ERC under the Office of the President (OP), as mandated by the Electric Power Industry Reform Act (Epira).
“The law [Epira] does not attach the ERC to the DOE because the regulatory agency has always been attached to the OP for political reasons,” said Lotilla, citing oil price, which was then a major political issue.
“It was more vulnerable when attached to OP because the relationship was more direct and politically sensitive,” he said, citing that institutions matter, particularly in building an enabling environment for private initiative. “Strengthening institutions and working together is important.”
His proposal does not require a new law since ERC’s mandate, when it comes to making decisions to protect the consumers, will remain.
“No, that is not needed. All that is needed is for the President to transfer ERC from the OP to the DOE. I think that transfer should be accompanied by additional resources for ERC, in terms of budgetary support to carry out its functions, as well as for the rationalization of salaries for ERC staff,” he said.
And if the government cannot provide a bigger budgetary amount that is needed by the ERC, Lotilla said the ERC should be allowed to keep part of its income to support various activities.
Vicente S. Perez Jr., also a former energy secretary who was among the panelists, agreed. “Yes, the ERC needs to keep whatever amount it collects and not remit it fully to the Department of Budget and Management.”
When sought for comment, ERC Executive Director Francis Saturnino Juan said coordination between the two agencies exists. “The objective he mentioned—the coordination between the DOE and ERC—can be achieved under the existing setup. Former Secretary Petilla knows that.”
He added: “In terms of discharge of functions, ERC was made by law independent even of the OP.”
But Lotilla replied: “But even if we are not able to attach ERC to the DOE, we still have other mechanisms like bilateral consultations and having more frequent coordination and interaction between the DOE and ERC.”
Petilla, on the other hand, said: “Either way is fine by me on whether ERC should be under the DOE. The important thing is that both agencies work together.” source
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