WESM/power companies set to increase power rates this month, TUCP warns

BUSINESS MIRROR

THURSDAY, 06 JANUARY 2011 20:27

THE Trade Union Congress Party (TUCP Party-List) on Thursday warned that the start of the wholesale Electricity Spot Market in the Visayas on December 26 last year, touted as a good market reform, will only spell higher power rates and hardship for Visayans.

“WESM is a curse, not a gift. It unleashes a permanent condition of rising power cost upon our consumers, institutionalizes overreliance on dirty coal, and is a body blow to our local economy,” said TUCP Rep. Raymond Democrito C. Mendoza in a statement.

TUCP said the Wholesale Electricity Spot Market (WESM) was originally conceived under the Electricity Power Industry Reform Act (Epira) as a mechanism to introduce competitiveness as all distribution utilities would be obligated to buy at least 10 percent of their power requirements from power generators bidding in supply through a power auctioner or market.

The trouble, according to TUCP, is that both the sellers and buyers really come from the same electricity oligarch or politician-turned-power mogul.

“The electricity market is really an area monopoly where, for example, an Aboitiz power generator sells to an Aboitiz electricity distributor, and this vertical integration of generator-transmission, and distribution means all our consumers are captive to their pricing whims. The power plants selling nearby are also in a monopoly situation over their own service franchise area with the same price-control exerted against the consumers. The 10-percent requirement is just camouflage so that the power moguls can rig the market,” Mendoza said.

TUCP said WESM is just being introduced to confuse the consumers as to who is to blame for their overpriced power, “Equally repugnant to us, is because there is no real competition —except the WESM moro-moro—we are forever tied to dirty, inefficient and expensive coal,” Mendoza said.

TUCP also warned that when the Transitional Supply Contracts artificially pegging the price of now-privatized, former-Napocor-owned plants to preprivatization levels runs out, by the middle of next year, the prices will further escalate. “The WESM serves merely to confuse and to infuse false hope for competition and lower prices,” said Mendoza.

TUCP called on Visayan religious leaders to take a stand on the matter. “Now it is only the moral leadership of the religious and the Church that can shed genuine enlightenment among all consumers. This will be key to an understanding of how this greed can be stopped in the political world.”