Published May 4, 2017, 10:01 PM By Myrna M.
Velasco
State-run National Transmission
Corporation (TransCo) is scheduled to secure the imprimatur of President
Rodrigo Duterte to either rescind or renegotiate the 25-year Concession
Agreement that the government had sealed with the National Grid Corporation of
the Philippines (NGCP) following alleged contractual violations committed by
the latter.
In a press conference, TransCo
President and Chief Executive Officer Melvin A. Matibag laid down the string of
NGCP’s offenses under the concession deal, albeit he emphasized that the last
critical major trigger had been the alleged act of the concessionaire to engage
in telecommunications business using the fiber optic cables (FOCs) linked to
transmission assets without prior information to and consent of the government.
Meanwhile, in a counter statement to
the media, NGCP Chief Administrative Officer Anthony L. Almeda noted that since
the company “took over power transmission services in 2009, it has always been
transparent with its operations.”
He said “it is unfortunate that the
issue on the use of the fiber optic network for the national broadband program
has been brought to the attention of the media by TransCo.”
Almeda added the company “does not
earn anything from existing fiber optic facilities,” explaining that “the main
purpose of the network is for the delivery of efficient power transmission
services.”
While the parties are currently at
odds on this issue, Almeda said “NGCP remains open to transactions with any
entity who is interested to develop the national broadband network, with the
national government as our priority.”
NGCP said, it is allowed to engage
in related businesses such as the fiber optic business which maximizes the use
of its existing assets as fiber optic assets are used by the grid primarily for
its operations, substation to plant communication and substation to
distribution center communications. Based on its franchise, NGCP added that,
NGCP is authorized in ancillary business and any related business which
maximizes utilization of its assets such as, but not limited to,
telecommunications system, pursuant to section 20 of Republic Act No. 9136.
The meeting with President Duterte
is slated in Malacañang on Monday (May 8), according to Matibag, and they are
also hoping to present to a Cabinet meeting similarly scheduled that day in the
Palace.
He explained that NGCP can engage in
broadband or Internet connectivity business, however, it cannot just do so in
the absence of the requisite functional unbundling of such business segments
and without the prior written consent of the Power Sector Assets and
Liabilities Management Corporation (PSALM) as stipulated under Section 8.03 of
their Concession Agreement. PSALM is the government-entity that privatized the
country’s transmission assets and also the counter-party in the concession
pact.
“A project of this nature and
magnitude requires a contract between the owner (TransCo) and NGCP,” Matibag
stressed. Nevertheless, he indicated that “this was implemented without PSALM’s
and TransCo’s knowledge or consent nor applied/petitioned with the Energy
Regulatory Commission.”
For neglecting such processes and
requirements, the TransCo chief executive noted that NGCP had been in patent
violation of the provisions of the Electric Power Industry Reform Act (EPIRA)
Law and the Concession Agreement.
Matibag qualified though that before
any stern move on the part of the State to void the concession deal, they are
still opening lines for “discussion with NGCP provided done in good faith on
how they can work together” on using the transmission system’s fiber optic
cables in the government’s broadband telecommunications project.
But if talks would fail, he asserted
that the last resort will be for the government to “rescind the concession
agreement” and revoke NGCP’s franchise or renegotiate its terms – and perhaps
for the government to go through the process of arbitration although that will
bear some costs on the State coffers. Filing of criminal and administrative
charges are also part of the government’s plan.
Matibag recounted how the government
has been consistently asking NGCP to provide them data on the fiber optics
component of the transmission assets, but he said, it had been unheeded for
some time.
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