PALACE PANEL INVESTIGATES ERC CHIEF

Manila Times.net
February 4, 2014 10:06 pm

by Joel M. Sy Egco Senior Reporter and Jomar Canlas Senior Reporter

MALACAÑANG has asserted its authority over the Energy Regulatory Commission (ERC) and formed a panel to investigate its head, Zenaida Ducut, for her alleged failure to stop the exorbitant rate hike imposed by the Manila Electric Co. (Meralco).

According to Presidential Communications Secretary Herminio Coloma Jr., the Investigative and Adjudicatory Division (IAD) of the Office of the Deputy Executive Secretary for Legal Affairs (DESLA) has received the complaint of party-list group Akbayan against Ducut.

“According to DESLA, they have started their probe on the case at hand,” Coloma told reporters.

Akbayan is widely known to be very close to President Benigno Aquino 3rd. Presidential Political Adviser Ronaldo Llamas is a leader of the group while former Akbayan rep. Risa Hontiveros ran but lost in the Senate race under the administration party.

Coloma explained that the IAD is the equivalent of the defunct Presidential Anti-Graft Commission that investigated appointed officials suspected of committing graft and corruption.

The DESLA is led by Deputy Executive Secretary Michael Aguinaldo.

Aguinaldo will submit his findings and recommendations to his boss, Executive Secretary Paquito Ochoa Jr., then to President Aquino.

Last week, Akbayan Reps. Walden Bello and Ibarra Gutierrez filed a verified administrative complaint before DESLA against the embattled ERC chief. DESLA is under the Office of the President.

The lawmakers asked the President to sack Ducut for her failure to protect power consumers. They said the Chief Executive has the authority to investigate, hear and decide complaints of gross neglect of duty and incompetence against presidential appointees who are directly under him.

They cited Section 46 of the Revised Rules on Administrative Cases in the Civil Services, which states that gross neglect of duty is punishable by dismissal from the service.

“Ducut is guilty of gross neglect of duty and incompetence by tacitly approving without the barest hint of due process Meralco’s unprecedented power rate hike,” Bello said.

For his part, Gutierrez said the Constitution provides that the President shall have control of all the executive departments, bureaus and offices to ensure economy and efficiency in the government.

He maintained that Aquino has the power to remove Ducut, explaining that presidential appointees with the exception of those appointed in constitutional bodies “come under the direct disciplining authority of the President.”

Coloma earlier gave assurances that Ducut will be accorded due process and will be given enough time and space to answer all charges leveled against her. Only after the conclusion of the probe can Malacañang decide on whether or not to keep Ducut.

The ERC chief was accused of ignoring the public by not conducting a hearing on the rate hike that was proposed by the power distribution firm.

“Her failure is stupefying considering that the increase in Meralco’s generation charge for the month of November 2013 was the largest under the regulatory regime implemented by the Epira [Electric Power Industry Reform Act] and administered by the ERC. It was incumbent upon Ducut being the head of the ERC to have conducted an immediate investigation into the matter,” Bello said.

He added that the ERC chair committed gross neglect of duty when she approved Meralco’s Power Supply Agreements (PSAs) with the generation companies supplying it with electricity.

“Under Ducut’s watch, the ERC did not require power suppliers to supply Meralco with replacement capacity and electrical output,” Bello said.

Lift TRO
Also on Tuesday, Meralco asked the Supreme Court (SC) to lift the 60-day temporary restraining order (TRO) it issued on December 23 stopping the power utility from implementing the P4.15 per kilowatt-hour rate increase.

Meralco officials said the new rate adjustment will spare the economy from a series of brownouts.

Meralco counsel retired SC Justice Florentino Feliciano told the tribunal that power regulation is a matter of policy that must be given to the discretion of the government’s political departments.

Feliciano said the SC does not have the discretion to decide on the case because it is the ERC that has the technical expertise on the matter. He added that factual issues are not tried by the High Court, thus, the petition questioning the power rate increase should be junked.

Victor Lazatin, another Meralco lawyer, warned that power outages will be inevitable in the hot summer months if the generation charge remains at P5.6 per kWh because of the TRO.

He pointed out that that demand for electricity escalates at an average of 8 percent in March, 16 percent in April, 17 percent in May, and 16 percent in June. During these months, water levels that run hydropower plants drop, which often lead to higher fuel cost.

“The fuel cost alone for bunker and diesel is approximately between P6.11 to P7.95 or almost P8. We anticipate that there will be a shortage if the SC will not lift the TRO on the generation charge and fix it at P5.6. The economic effects will include brownouts,” he pointed out.

“Meralco has received threatening demands from the WESM (Wholesale Electricity Spot Market), NGCP (National Grid Corporation of the Philippines) and 6 gencos not only for the December bill but also for the January bill asserting that it is not covered by the TRO by this honorable Court,” Lazatin said.   source