(The Philippine Star) | Updated December 17, 2013 - 12:00am
MANILA, Philippines - It is up to Energy Regulatory Commission (ERC) chief Zenaida Cruz-Ducut to resign or take a leave, Malacañang said yesterday amid the outrage over a sharp hike in electricity rates blamed on alleged collusion among power plant operators.
The ERC approved the Manila Electric Co. (Meralco)’s huge rate increase of P4.15 per kilowatt-hour, which the power distributor blamed on the scheduled maintenance shutdown of the Malampaya natural gas plant and the simultaneous “forced shutdown” of other power facilities.
The government is investigating the alleged collusion.
Ducut, a former Pampanga congresswoman, is also implicated in the Priority Development Assistance Fund (PDAF) or pork barrel scam.
She allegedly demanded a five-percent kickback for every PDAF-funded project she delivered to her close associate, suspected pork barrel scam mastermind Janet Lim-Napoles, according to an affidavit of whistle-blower Benhur Luy.
In his testimony, Luy alleged that Ducut used to regularly visit Napoles’ 25th floor office at Discovery Suites in Pasig City to get her commission.
Ducut represented the second congressional district of Pampanga from 1995 to 2004. In 2008, Ducut was appointed ERC chair by then President Gloria Macapagal-Arroyo, who now represents that district even while in detention.
Ducut has ignored calls for her to resign, saying she has not yet received a copy of the complaint from the Ombudsman.
Asked if the ERC should be included in the alleged collusion being investigated, presidential spokesman Edwin Lacierda said, “I think that’s part of the mandate of (Energy) Secretary (Jericho) Petilla to look into... (the alleged) collusion that happened.”
Asked if heads should roll in the ERC, Lacierda said, “We don’t want to preempt the investigation process. We would like to wait for the process to complete itself, and I think Secretary Petilla has already said that… the results will be forthcoming… Let’s wait for the results of the investigation.”
He said Ducut continued to remain silent. “On our part, it’s (pork barrel case) now with the Ombudsman. The Ombudsman is investigating, there is an evaluation of the complaint filed by DOJ. So let us just wait for whatever will be the result of the investigation of the Ombudsman,” he said.“But a case has been filed. There is presumption of innocence so we will hope to see the Ombudsman coming up with the result of its (evaluation), if there’s really a basis for the DOJ case and if there will be cases to be filed,” he added.
Lacierda said even the decision of former Customs commissioner Ruffy Biazon to resign after being implicated in the pork barrel scam was his own.
“And we certainly welcomed his bold step of offering to resign. With respect to Ms. Ducut, I have no idea if she will do the same. We leave that to her personal decision, whether she should take a leave, resign. That is not within our competence to determine,” Lacierda said in a press briefing.
On Sen. Antonio Trillanes IV’s pronouncements that the government was not doing enough to protect the public from rising prices, Lacierda said the senator was entitled to his own opinion but reminded him that it was the ERC – an independent body – that approved the electricity rate increase.
“Nonetheless, we are investigating the whole process of the increase of the power rates,” Lacierda said.
Case vs power firms
As outrage mounts over the sharp hike in electricity rates, militant lawmakers yesterday filed a formal complaint with the Department of Justice (DOJ) against Meralco and several power firms for their possible violation of the law against monopolies and cartels.
Akbayan Reps. Walden Bello and Ibarra Gutierrez III specifically asked the DOJ to investigate Meralco, First Gas Power Corp., San Miguel Corp. Global Power Holdings (holding company of Kepco Philippines), Aboitiz Power Corp., Team Energy Corp., AES Philippines and DMCI Holdings Inc. for “possible violations of laws prohibiting cartelization, monopolies and combinations in restraint of trade as defined in competition laws.”
They did not specify the charges that they wanted the DOJ to build against the power firms.
In their two-page letter-complaint, the lawmakers cited the “simultaneous and unscheduled shutdown during the same period” of the power plants owned by the respondent firms.
“This increase in electricity costs added to the economic burden of end-users and consumers who, at a time when the whole nation is reeling from the brunt of Typhoon Yolanda and in anxious anticipation of the holiday season, face increases in prices of basic commodities like liquefied petroleum gas and Metro Rail Transit fares,” they said.
“Now, more than ever, is the time to call on the government and all its regulatory and investigating agencies to examine the spike in electricity rates… The investigating powers of the Department of Justice, as the country’s competition authority, should be harnessed in assessing the price increase amid the tight supply and high market concentration among very few players in the generation of electricity,” the complainants added.
Joining Bello and Gutierrez in filing the complaint were the Center for Power Issues and Initiatives, Freedom from Debt Coalition, and Partido Manggawa-NAGKAISA Labor Coalition.
But even before the filing of the complaint, Justice Secretary Leila de Lima had ordered the DOJ’s office for competition (OFC) to start its fact-finding investigation into the matter as reported by The STAR yesterday.
In an interview yesterday, De Lima said a fact-finding panel would specifically look for possible violations of anti-trust laws.
“The policy under our Constitution is that there should be competition in businesses – not collusion. Collusion is the very antithesis of competition. So we may look at possible restraint of trade and unfair business practices,” she said.
She said the DOJ panel would invite Energy department and ERC officials as well as executives of Meralco and other power firms named in the controversy.
“We want to conduct a holistic inquiry and come up with a complete report. This is a very significant matter, a hot issue, a matter of national interest and it’s clear in the mandate of the OFC to know exactly if these increases are justified,” she said.
President Aquino created the OFC in 2011 to investigate cases of unfair business practices like monopolization and cartelization.
Resign first
Militant lawmakers belonging to party-list group Bayan Muna also said there is no other option for Ducut but to resign.
The lawmakers renewed their call after Ducut again failed to attend the second hearing of the House energy committee on the Meralco rate increase.
At the Senate, committee on energy chairman Sergio Osmeña III said Ducut should be ready with a valid explanation if she fails to attend tomorrow’s hearing.
“Yes, we might have to subpoena her, but first ask her to explain because that’s our standard procedure,” Osmeña said.
Sen. Ramon Revilla Jr. said the ERC had a lot of explaining to do. “It seems that the agency favors the interests of the private companies over the public’s interests,” he said.
“It not only failed to secure the welfare of the people but also failed to protect the consumers’ rights by burdening them with financial responsibility which is supposed to be handled by the government,” he added.
Trillanes said Ducut’s presence in tomorrow’s hearing is a must. “We shall see what she would do. She is supposed to be in the frontline. The ERC is supposed to be in the frontline of protecting the interest of consumers, but in this case, they are the ones lawyering, they are the ones justifying (the rate increase),” Trillanes said.
Bayan Muna Rep. Neri Colmenares said the ERC chief should quit her job and spend her time defending herself from accusations that she had acted as agent for some former lawmakers accused of misusing their pork barrel allocations.
The National Bureau of Investigation has filed graft charges against Ducut, who enjoys a fixed term as ERC head.
Mindoro Oriental Rep. Reynaldo Umali, House energy committee chairman, said he would send a third invitation for Ducut to attend the panel’s next hearing in January.
“She will have to attend or we will subpoena her. There are questions from some committee members that only she as ERC chairperson could answer,” he said.
Colmenares also vowed to contest the constitutionality of the P4.15-per-kilowatt-hour electricity rate increase this week before the Supreme Court, along with consumer groups.
“It is unconstitutional in the sense that it was passed on to the public without due process, without public hearings and consultations,” he said.
He said the ERC cannot allow Meralco to automatically bill customers any rate increase without scrutinizing the details of such an adjustment and subjecting it to public hearings.
“ERC’s automatic pass-on mechanism violates the right of the public to due process, a right guaranteed by the Constitution,” he said.
Meralco had claimed that it did not have to seek ERC approval for the collection of the latest increase because it is allowed to do so under ERC rules.
What Meralco did was seek ERC’s go-signal for a staggered billing of the adjustment.
Colmenares said the alleged collusion among several power producers would also be cited as a ground for stopping the rate increase.
Meanwhile, militant workers yesterday staged simultaneous protest actions outside several offices of Meralco to dramatize their opposition to the impending power rate hike.
“We have staged coordinated picket in front of Meralco branches in Parañaque, Rizal and Cavite,” Wilson Fortaleza, Partido ng Manggagawa spokesman, said.
“If competition exists in the power industry then business interests would collide but under EPIRA, the players collude,” Fortaleza said.
“If P-Noy is serious about investigating Meralco’s hike, then he can do something through the OFC which is under his authority, unlike the ERC,” Fortaleza said. – With Jess Diaz, Edu Punay, Marvin Sy, Mayen Jaymalin, Iris Gonzales source
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