By Jess Diaz (The Philippine Star) Updated October 13, 2010 12:00 AM Comments (1)  |
MANILA, Philippines - The Department of Energy will try to reduce the impending increase in electricity rates.
Speaking over dzMM radio, Energy Secretary Rene Almendras confirmed a report in The STAR that electricity rates would go up by 30 centavos per kilowatt-hour.
“But we are trying our best to reduce this to 20 centavos and I think we have the formula,” he said.
Almendras said the impending increase would enable the government to raise funds to pay for about P470 billion in accumulated debt of the state-owned National Power Corp. (Napocor) and the Power Sector Assets and Liabilities Management Corp. (PSALM).
PSALM has already filed a petition with the Energy Regulatory Commission to collect the increase over a 16-year period, he added.
Commenting on Almendras’ statements, Eastern Samar Rep. Ben Evardone said it would be a big relief for consumers if the energy secretary could really cut the forthcoming rate adjustment by 10 centavos per kwh.
“I think he should explain to the public how he will do that without lengthening the period within which consumers will pay the increase,” he said. “He should reveal his formula.”
There would be no real relief if the rate were reduced to 20 centavos but with a longer payment period, according to Evardone, author of a resolution seeking an inquiry into what happened to the proceeds from Napocor’s privatization and the sale of its assets.
In his radio interview, Almendras said he has created a task force to audit Napocor and PSALM so he would know what happened to the privatization proceeds and whether the government was not shortchanged in the sale of Napocor’s assets.
PSALM has already sold some $10-billion worth of assets but that only $4 billion was paid in cash, he added.
The balance of $6 billion would be paid in installments, he said.
Almendras said he has asked PSALM officials why they allowed installment payments when the buyers or concessionaires already took over Napocor’s assets, but that he was told that this arrangement was legal.
Although the arrangement may be legal, it is not the best deal for the government, he added.
Evardone said had PSALM done its job, it would have already paid for Napocor’s huge indebtedness and there would be no need for the impending 30-centavo increase in electricity rates.
“PSALM has generated $10.6 billion from privatization and $2.8 billion in new loans for a total of $13.4 billion, but it has paid only $1.3 billion of Napocor’s indebtedness,” he said. “Where did the $12.1 billion go?”
Evardone said when Congress enacted the Electric Power Industry Reform Act (Epira) of 2001, Napocor’s debts stood at $9.3 billion.
“Under Epira, taxpayers, through the national government, immediately absorbed P200 billion or about $4 billion of those debts, leaving a balance of $5.3 billion,” he said.
Evardone said if PSALM paid the balance of Napocor’s indebtedness using the $10.6 billion generated from the sale of its assets, the government would still be left with a surplus of $5.3 billion.
“But there is no surplus. They even contracted new loans. I think our people will not accept new rounds of increases in electricity rates unless they are informed and satisfied where billions of dollars in privatization proceeds and new loans went,” he stressed.
The House energy committee has not conducted any hearing on power rates despite several resolutions seeking inquiries. Batanes Rep. Henedina Abad, wife of Budget Secretary Florencio Abad, chairs the committee.
Speaking over dzMM radio, Energy Secretary Rene Almendras confirmed a report in The STAR that electricity rates would go up by 30 centavos per kilowatt-hour.
“But we are trying our best to reduce this to 20 centavos and I think we have the formula,” he said.
Almendras said the impending increase would enable the government to raise funds to pay for about P470 billion in accumulated debt of the state-owned National Power Corp. (Napocor) and the Power Sector Assets and Liabilities Management Corp. (PSALM).
PSALM has already filed a petition with the Energy Regulatory Commission to collect the increase over a 16-year period, he added.
Commenting on Almendras’ statements, Eastern Samar Rep. Ben Evardone said it would be a big relief for consumers if the energy secretary could really cut the forthcoming rate adjustment by 10 centavos per kwh.
“I think he should explain to the public how he will do that without lengthening the period within which consumers will pay the increase,” he said. “He should reveal his formula.”
There would be no real relief if the rate were reduced to 20 centavos but with a longer payment period, according to Evardone, author of a resolution seeking an inquiry into what happened to the proceeds from Napocor’s privatization and the sale of its assets.
In his radio interview, Almendras said he has created a task force to audit Napocor and PSALM so he would know what happened to the privatization proceeds and whether the government was not shortchanged in the sale of Napocor’s assets.
PSALM has already sold some $10-billion worth of assets but that only $4 billion was paid in cash, he added.
The balance of $6 billion would be paid in installments, he said.
Almendras said he has asked PSALM officials why they allowed installment payments when the buyers or concessionaires already took over Napocor’s assets, but that he was told that this arrangement was legal.
Although the arrangement may be legal, it is not the best deal for the government, he added.
Evardone said had PSALM done its job, it would have already paid for Napocor’s huge indebtedness and there would be no need for the impending 30-centavo increase in electricity rates.
“PSALM has generated $10.6 billion from privatization and $2.8 billion in new loans for a total of $13.4 billion, but it has paid only $1.3 billion of Napocor’s indebtedness,” he said. “Where did the $12.1 billion go?”
Evardone said when Congress enacted the Electric Power Industry Reform Act (Epira) of 2001, Napocor’s debts stood at $9.3 billion.
“Under Epira, taxpayers, through the national government, immediately absorbed P200 billion or about $4 billion of those debts, leaving a balance of $5.3 billion,” he said.
Evardone said if PSALM paid the balance of Napocor’s indebtedness using the $10.6 billion generated from the sale of its assets, the government would still be left with a surplus of $5.3 billion.
“But there is no surplus. They even contracted new loans. I think our people will not accept new rounds of increases in electricity rates unless they are informed and satisfied where billions of dollars in privatization proceeds and new loans went,” he stressed.
The House energy committee has not conducted any hearing on power rates despite several resolutions seeking inquiries. Batanes Rep. Henedina Abad, wife of Budget Secretary Florencio Abad, chairs the committee.
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