GSIS TO USE PREPAID SCHEME ONCE IT GAINS CONTROL OF MERALCO
MANILA, JUNE 8, 2008 (STAR) By Ma. Elisa Osorio - The Government Service Insurance System (GSIS) announced it will implement a prepaid payment scheme for electricity once it gains control of the Manila Electric Co. (Meralco).“We are looking at a prepaid scheme in order to eliminate system pilferages and will likewise reduce the cost of collection,” GSIS general manager Winston Garcia said in a press conference held before the long weekend.
According to Garcia, the prepaid scheme will reduce the operations cost of Meralco. Not only will it eradicate stealing of electricity which adds to the costs of the company, it will lower the operations costs, he said.
Garcia explained that under the prepaid scheme, there will be no more metering charges.
Likewise, he said there will be no need for meter readers. Meralco employs a number of meter readers and the prepaid scheme will make the job obsolete.
“The cost of maintaining people is costly,” he said.
Garcia said that the system is needed in areas where there are a lot of pilferages but in the long run, the plan is to make everything prepaid.
“We would like to change all the meters, if you have no load then you will have no electricity,” he said. “There will be no more post payment so that the consumers will pay immediately.”
He conceded that the implementation of the new payment system will take time but he stressed it is doable because it is already being implemented in other countries like India.
“I’ve already presented this idea before to the management of Meralco but they refused,” Garcia said.
In the same press conference, Garcia presented his plan to reduce the cost of electricity by 10 percent to 20 percent.
Garcia said he will cancel the take or pay, capacity, transmission line and fixed operating fees provisions of the IPP, which he considers “highly onerous.”
Judging from the 2007 figures, the cancellation of the provisions will give consumer savings of at least P21 billion.
The P17 billion was for lease while the P4 billion paid was for the unused power from First Gas, he said.
The IPP Garcia is referring to is Sta. Rita and San Lorenzo.
Garcia stressed that the take or pay is a violation of the EPIRA (Electric Power Industry Reform Act) and the Meralco franchise.
Section 23 of EPIRA and Section 4 of the Meralco franchise impose the obligation to supply electricity to its captive market in the least cost manner.
Aside from this, Garcia said they would immediately increase the power purchased from Napocor from 35 percent to 70 percent.
This would translate to a 19-percent reduction in generation cost to P3.93 per kilowatthour from P4.87 per kilowatthour, he said.
Other improvements Garcia wants to implement in Meralco are the changes in the pension scheme, more transparency and serious efforts to curb systems losses.
At the same time, Garcia challenged the Makati Business Club (MBC) to invite him to a forum to discuss the issues surrounding Meralco instead of “blindly defending” the Lopez family which controls the utility firm.
However, MBC executive director Alberto Lim said as of the moment, they have no plans of inviting Garcia to any general membership meeting, but added he can ask MBC directors if they are interested in a dialogue with Garcia.
“Why should we do that? We are not interested in getting involved with his issues. What we are interested in is the public issue,” Lim told The STAR in a telephone interview.
He also reiterated that MBC is not taking the side of Meralco.
Lim said Garcia should not use the money of GSIS members in his fight with the Lopez family.
In a statement, GSIS chief legal counsel and spokesperson Estrella Elamparo stressed that the MBC should practice objectivity and impartiality in looking at the issues of mismanagement and abuses raised by the GSIS against Meralco. – With Delon Porcalla
Reported by: Sol Jose Vanzi
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