Emergency powers cover adjusted ‘work week’

Manila Bulletin
by Myrna Velasco
September 12, 2014

Beyond power supply contracting, there are other facets on the proposal to invoke Section 71 or the declaration of power crisis under the Electric Power Industry Reform Act (EPIRA) – and that includes revamping work week from Tuesday to Saturday.

That is based on presentations made by the Department of Energy (DOE) to various business groups – indicating that such shall be part of the ‘energy savings initiative’ to be undertaken under Section 71 fiat.

The department said there shall be “adjustment of work week from Monday-Friday to Tuesday-Saturday during the period.”

The others are mandates on: direct energy intensive activities during off-peak hours, limited operation of billboards, and ‘required cooperation’ subject to payment of just compensation.

The reference on ‘required cooperation’, however, is being viewed as ‘mandatory’ by stakeholders and prospective participants in the Interruptible Load Program (ILP) fear such prescription because it may not consider the technical limitations of their generating sets.

The coverage of Section 71 enforcement being sought by President Aquino from Congress is for years 2015 and 2016 when power supply in the Luzon grid has been anticipated to be on deficit mode.

That particular provision of the law states that “upon the determination by the President of the Philippines of an imminent shortage of supply of electricity, Congress may authorize, through a joint resolution, the establishment of additional generating capacity under such terms and conditions as it may approve.”

Energy Secretary Carlos Jericho L. Petilla wanted to package the bid for government-underpinned supply contracting as a ‘form of insurance capacity’, but moves of invoking Section 71 of the power industry reform law cannot be interpreted any other way but “declaration of power crisis.”

The dangerous part would also be the introduction of subsidy, because once consumers would get used to paying ‘artificially-low rates’ again, it would take time to get them re-oriented on paying the true cost of electricity post the crisis scenario.

Several quarters, including prospective participants in the ILP have been proposing alternatives, but obviously the DOE is just bent on invoking Section 71.

On supply contracting, there are also questions as to how the process of selection of additional power capacity providers shall be undertaken, especially if the government is thinking of enforcing short cut processes on procurements. (MMV) source