By
Lenie Lectura - February 13, 2020
PUWERSA ng
Bayaning Atleta (PBA) Party-list Rep. Jericho Nograles on Wednesday urged
the Department of Energy (DoE) to declare null and void the contract
between the Philippine Electricity Market Corporation (PEMC) and the
Independent Electricity Market Operator of the Philippines Inc. (Iemop) because
the deal was not approved by President Duterte.
In a statement,
Nograles said the contract is “void ab initio” or invalid from the very
beginning. He said PEMC must seek the endorsement of the Governance
Commission for Government-Owned or -Controlled Corporations (GCG) and
thereafter seek final approval from the President.
PEMC used to be the operator
of the Wholesale Electricity Spot Market (WESM) before Iemop took over. PEMC
remains the governing arm of WESM.
According to Nograles,
PEMC’s claimed transition from being a GOCC to a fully privatized company was
“not proper and not legally-binding” because this was not approved by the
President.
Nograles said PEMC has
neither the recommendation of the Governance Commission of GOCCs nor the
approval of the President, thus making the PEMC-Iemop contract void from the
very beginning.
“The continued collection
of market fees from consumers is illegal because the contract is illegal. I
sincerely believe that the President was blindsided that something this massive
happened. If the President knew that this is going to happen, he would have
affixed his signature to privatize PEMC. PEMC was never privatized. The
President does not know that this happened,” Nograles said.
PEMC used to collect
about one centavo for every kilowatt-hour (kWh) from the consumers’
monthly electric bill. The Energy Regulatory Commission (ERC) authorized this
in 2014. But IemopP, now the operator of WESM, has yet to secure a similar
approval from the ERC.
“So, who approved this
deal? Congress will get to the bottom this. In the last two committee hearings,
I think Congress has enough evidence and information to declare the contract
void ab initio,” Nograles said, adding that the identity of “the persons behind
this illegal contract is something we have yet to establish and I intend to
pursue this to the end.”
Nograles noted that the
deal, which allowed a 7,000 peso-company like Iemop P to take over and use
PEMC’s P781-million computer equipment for free and automatically deduct at
least .84 centavos pe kWh from electricity consumers, is anomalous and could be
the basis of filing multiple cases against its officials.
“A typical household
that consumes about 200kWh pays Iemop around P2 per month. Multiply that by the
millions of households and Iemop collects over a billion pesos a year. This is
very alarming because Iemop does not even have any ERC approval to do so,”
Nograles said.
“We see a variety of
Republic Acts violated in this corrupt deal. For the next Committee on Energy
hearing, we will invite the Energy Regulatory Commission, the Philippine
Competition Commission, and again the Governance Commission for GOCCs as the
regulatory agencies that have been bypassed by PEMC. There is clear corruption
in this power scam,” Nograles added.
Nograles said that
since all transactions involving IEMOP as an independent market operator are
questionable, the DOE should declare the contract null and void.
The DOE, PEMC and
Iemop, for their parts, earlier said that the latter was created by virtue of
the enactment of DOE Department Circular 2018-01-0002 dated January 17, 2020
and consequently the IMO Transition Plan, which are based on Section 30 of
the Electric Power Industry Reform Act (Epira), which were jointly approved by
the DOE and the Electric Power Participants.
Also, the DOE said a
competitive bidding was required only for foreign participants as an option
under the Epira if the IMO was created in 2007.
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