What gives? Chiz asks Palace on extra power

Manila Standard Today
By Macon Ramos-Araneta | Sep. 22, 2014 at 12:01am

SENATOR Francis Escudero on Sunday asked the Palace to attach a price tag to the emergency powers that it is seeking for President Benigno Aquino III to cope with a looming shortage of electricity in 2015.

“What’s the cost to taxpayers of this measure?” Escudero, chairman of the Senate finance committee, asked.

Escudero said the power the government is seeking is “basically the authority to enter into purchase agreements with private power producers.”

Escudero
“Even if power contracted by the government will eventually be sold to distributors, and thus the acquisition cost will be recouped, we still would like to know the costs involved” Escudero said.

“How will it be financed? Even if it’s an off-budget transaction, the government has the duty to publicly disclose the details,” he said.

Escudero said full disclosure was required, particularly if contracted power must still be paid for, even if it is not used.

“What is the burden of this to the consumers? Will it entail additional costs to us? If it’s through the electric bill of consumers then government should tell them in advance,” he said.

If the National Grid will loan or advance it or if it will be taken from the Malampaya royalty, it should be revealed,” he said

Escudero was referring to the government share of the Malampaya natural gas field, which next year will reach P34.5 billion, according to 2015 national budget.

If government will tap Malampaya as the “fuel for emergency powers, then it should tell us how it will be done and the amount involved,” Escudero said.

He said a “powerful light” must shine on these contracts “in the interest of transparency and to prevent a repeat of the country’s experience during the energy crunch of 1990s when power contracted later burdened consumers.”

He noted that the stranded costs” in the billions of pesos were still being collected from consumers through their monthly electric bills.

President Aquino has sought a joint congressional resolution which would authorize the government to order additional generating capacity of about 600 megawatts.

This would go to meeting the projected baseload deficit of 300 megawatts and act as a 300-megawatt buffer that is equivalent to 4 percent of peak demand.

In a report to Congress, Energy officials forecast an energy shortage in Luzon at 400 MW to 1,000 MW during the first half of next year.

To plug this gap, Energy Secretary Jericho Petilla convinced the President to invoke Section 71 of the Electric Power Industry Reform Act (Epira) of 2001which allows the government to contract additional generating capacity under terms and conditions Congress may approve.

Escudero said he favors the grant of such power given the “bleak power outlook” for next year.

The Energy Department warned there will be some days of April and May 2015 when the power deficit will reach 300 megawatts.

This will be exacerbated by scheduled maintenance shutdown of the Malampaya natural gas facility in offshore Palawan from March 15 to April 14 next year.

The senator said even without maintenance issues, the country needs to commission more plants because any growth in the economy triggers a corresponding hike in the demand for electricity. source