By
Cecilio Arillo - July 2, 2019
EARLY this month 33
years ago after the so-called Edsa revolution in February 1986, President
Corazon Cojuangco Aquino abolished the Ministry of Energy (MOE) and placed all
energy matters under the full control of her office.
After scoundrels in and
outside of her office systematically plundered and depleted the MOE’s
multibillion-peso assets, she issued Executive Order (EO) 215 on July 10, 1987,
deregulating the energy industry and privatizing its money-making corporations
and subsidiaries, including the Philippine National Oil Corp., a successful
Philippine firm featured successively in Fortune’s 500 Best Corps., and the
highly profitable Petron that served as a buffer against foreign oil production
and distribution monopoly. Petron then controlled 40 percent of the country’s
fuel distribution network.
Apart from abolishing
the MOE, President Aquino hurriedly returned a much larger, more expensive and
very profitable Manila Electric Co. (Meralco), gratis et amore, to the Lopezes
and their business associates.
It can be recalled that
aside from the transfer of all the electric power generating plants of Meralco
to the National Power Corp. (NPC) before the Edsa Revolution, the Lopezes and
their associates, for financial reasons, divested themselves of their interest
in Meralco.
As a consequence, all
the Meralco shares of stock were sold and transferred to the Meralco
Foundation, a non stock and non profit foundation, for P872,764,365.
The transaction
subsequently gave every Meralco electric consumer a stock warrant from the
Meralco Foundation. The stock warrants issued by the Meralco Foundation bore
individual serial numbers, and these were to be exchanged with Meralco shares
upon the fulfillment of certain conditions.
Worse, the EO
introduced the injurious and much-hated Purchased Power Adjustment or PPA,
which Meralco inordinately used to charge consumers higher electricity rates.
Before the issuance of
the EO, the NPC, whose income from 1977 to 1985 rose from P0.4 billion to P18
billion in sales revenue, had total assets of P107.2 billion, almost 10 times
of what it had in 1977. The Aquino administration systematically broke it up
and privatized majority of its operations, including generations, transmissions
and distribution under the guise of ridding government monopoly in the
distribution of power.
Curiously, the
Presidential Commission on Good Government subsequently charged the late Energy
Secretary Geronimo Zamora Velasco with alleged corruption, only to be declared
innocent by the Supreme Court.
Velasco died on July
17, 2007, but left behind a solid reputation of honesty and certitude as well
as his own personal files, copies of which were made available to this writer
who exposed in his book A
Country Imperiled: Tragic
Lessons of a Distorted History the unforgivable sins of the Aquino
Regime in the energy sector.
Here’s an extract from
Mr. Velasco’s explosive files:
“…it appears that Mrs.
Aquino abolished the ministry upon the advice of Cesar Buenaventura, who had
claimed that the Ministry of Energy was ‘the most corrupt’ among the Marcos-era
agencies. [Joker Arroyo, President Aquino’s executive secretary, who had
witnessed how hard Buenaventura lobbied to have the Ministry abolished,
confirmed Velasco’s statement in his book]:
“…Cesar Buenaventura
was one of Mrs. Aquino’s closest advisers, but he also happened to be the
president of Pilipinas Shell at the time. I have no idea as to Buenaventura’s
basis for claiming that the ministry was the ‘most corrupt,’ but I also have no
doubt that he had Shell’s interest in mind when he recommended the ministry’s
abolition. I could sense that the foreign oil companies were never happy with
Philippine National Oil Co., not only because Petron led the pricing structure
in the oil market, but also because PNOC’s energy development program, with its
emphasis on tapping non-oil sources, threatened to erode the oil companies’
position in the energy market.
“Riding on the wave of
anti-Marcos sentiment was a good way to eliminate a rival. In my opinion, the
abolition of the ministry showed Mrs. Aquino’s inexperience in proper
governance. Buenaventura may have been a close friend of hers, but how could
she, in conscience, consult someone like him whose interest was to protect his
employer, a foreign oil company operating in the Philippines? On the mere
say-so of Buenaventura, Mrs. Aquino dismantled the whole energy complex that
took 12 years to build and which, in government annals, was unique for its
successes despite numerous crises that the country faced at that time.
“Incidentally, the
Queen of England knighted Buenaventura thereafter. Did that have anything to do
with the ministry’s fate?
“From a policy
perspective, there was no reason to privatize PNOC/Petron even at the time. Why
would a government in dire need of cash be willing to let go of a good source
of income? PNOC was the biggest government corporation in terms of revenue.
“It was not until we
operated Petron that I started to realize how critical an oil company is to a
country. The oil companies in the Philippines have been with us for almost a
century. In fact, the phrase ‘old China hand’ emanated from the oil companies
because some of those people assigned to the Philippines were ‘old China hands’
who had been previously employed in the oil companies’ pioneering ventures in
China.”
The impact of Cory’s
deliberate actions resulted in endless electric bill increases and a spate of
brownouts that continue to hurt us up to this day.
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