[PHOTO -President Aquino greets participants at the Philippine Investment Forum yesterday. The forum brought together government officials, top Filipino business executives and local and foreign investors to offer a global audience a balanced perspective on investing in the Philippines)]

MANILA, MARCH 29, 2012 (PHILSTAR) By Aurea Calica - Malacañang is open to discussing proposals by some lawmakers to grant emergency powers to President Aquino to deal with the power crisis in Mindanao.

“We will have to study the proposal when filed in the Lower House,” deputy presidential spokesperson Abigail Valte said yesterday.

“As of the present time, the power situation is being addressed by the Department of Energy with the stakeholders in Mindanao.”

Energy Secretary Jose Rene Almendras also said he is open to giving Aquino emergency powers to resolve the crisis.

The President, speaking at the Euromoney Philippine Investment Forum in Makati City, said the Philippines is likely to meet the projected increase in demand for electricity sooner than expected through the government’s national renewable energy program.

Aquino has appealed to the public to give the government more time to solve the power crisis, saying previous administrations had long neglected problems in the power sector.

The President told the forum that the country would need 15,500 megawatts by 2030, and that so far, more than 7,000 MW worth of service contracts had been approved.

“Pending applications (cover) around 3,771 megawatts together with the installed capacity of about 5,000 (MW)… It seems to be a clear path already to attaining that needed energy by 2030 even in the next perhaps three to four or five years,” Aquino said.

“We will be ready when that demand comes in... hopefully this will also be the factor – that there is an increase in store generation capacity – that will bring down the prices of electricity,” he said.

Almendras, meanwhile, said emergency powers for the President should also mean allowing state-run agencies to engage in power supply contracts, an arrangement currently prohibited under the Electric Power Industry Reform Act (EPIRA) of 2001.

“We will recommend that for a limited period of time,” he said. “I want to understand first what the special power they want to give him.”

To dispel accusations that the government is doing nothing on the situation in Mindanao, Almendras said the government has already started a P2.6-billion rehabilitation for Agus Hydro Power Complex in Mindanao.

He also scored some sectors that said the government is doing nothing to address the matter, saying the present administration is doing everything to make sure there is enough power in the whole country.

At the House of Representatives on Monday, Eastern Samar Rep. Ben Evardone, chairman of the House committee on public information, warned of more damage to the economy and to the image of the country if the widespread blackouts in Mindanao persist.

“The situation could be considered urgent and critical that needs swift action from the President,” he said. “Many of us in the administration bloc are willing to support moves to grant the President emergency powers if necessary.”

Ang Kasangga party-list Rep. Teodorico Haresco, vice chairman of the House committee on small business and entrepreneurship development, and Negros Occidental Rep. Albee Benitez also voiced support for calls to give Aquino more muscle in addressing the power crisis in Mindanao.

“We cannot just flick our fingers and command the Department of Energy to correct the imbalance between demand and supply of energy. This administration is barely two years old and the Mindanao energy problem has been there since three decades ago,” Haresco said.

Davao City Rep. Karlo Alexei Nograles, who earlier aired suspicion that the power crisis could be artificial, said he supports emergency powers for Aquino “provided that it is clear why it (emergency powers) is needed.”

‘Standby powers’

For Sen. Francis Escudero, what President Aquino needs to address the power crisis is not only emergency powers but “standby powers” with no need for congressional approval.

Escudero said his proposal may be introduced as an amendment to Republic Act 9136 or EPIRA.

“It should be standby powers so that there is no need to pass a new law authorizing such each time there is a crisis,” Escudero said.

“For me, it’s a crisis situation in Mindanao already. We are okay in Metro Manila because we don’t feel it. But in Mindanao, we are talking of two to four hours a day (of blackouts). Definitely, the economy and business are affected already. (The power crisis) will worsen the way of conducting business there, especially since many of our fellow countrymen who are poor are in Mindanao,” Escudero told The STAR.

Apart from Escudero, Senators Serge Osmeña III and Antonio Trillanes IV are also open to the idea of granting Aquino special powers.

With standby powers, Escudero said the President can easily enlist the support of concerned agencies in any move to interfere in the market, possibly in imposing price caps.

“There are proposals that the government should buy the power barges to be able to implement concessionaire rates. But under EPIRA, that is not allowed since power service is already being privatized. The most you can do is to delay privatization,” Escudero explained. “With emergency standby powers, just on the interim, that one as an example, the President can interfere in the market.”

He said government’s imposing cap on prices would stop monopolistic tendencies and abuse of power by certain providers and distributors.

Allaying fears of abuse, Escudero said Congress can always provide safeguards like limiting the exercise of such special powers to a certain timeframe.

Trillanes, in a text message, said he is already drafting a bill on granting emergency powers to the President “similar to what was given to (former President) FVR (Fidel Ramos) but with necessary safeguards to make sure that we don’t commit the same mistakes.”

Osmeña, chairman of the Senate committee on energy, noted that the President is already vested under the EPIRA with emergency powers to seek ways to raise generation capacity but only after approval from Congress.

Call for unity

Meanwhile, Sen. Aquilino Pimentel III is calling on fellow legislators from Mindanao to “come together at the soonest possible time and thresh out solutions that can be implemented immediately.”

“The power outages are not only worsening in Mindanao, there are indications that we will be suffering up to eight-hour power interruptions for a year or two,” Pimentel said in a statement.

“We can already predict that this will lead to a sharp decline in economic activity that may lead to losses of jobs and livelihood. This will heighten poverty in some Mindanao provinces and may create pressures that may spark disruptions in Mindanao’s peace and order situation,” Pimentel added.

He said the lack of permanent government measures to raise and stabilize supply has made the power crisis worse and driven away investors.

For his part, Sen. Panfilo Lacson said he is wary about giving the President emergency powers even as he raised suspicion regarding the real cause of the problem.

“The power shortage in Mindanao is a result of years, if not decades, of neglect. Sometimes there is basis to suspect that the crisis has been stage-managed because of corporate greed and cronyism. As usual, it is the people who will suffer,” Lacson said in a text message to the Senate media.

A militant, meanwhile, said Aquino does not need emergency powers from Congress to put an end to the power crisis in Mindanao.

“It appears that there is enough power supply in the south. The blackouts are an issue of transmission and distribution, which the President can resolve with his broad executive powers,” Bayan Muna party-list Rep. Teddy Casiño said.

He said what is needed is political will on the part of the government.

He pointed out that the “knee-jerk” reaction of some Aquino allies to the Mindanao blackouts could lead to “Ramos-style emergency power palliative that could further aggravate the problem.”

He was referring to emergency powers Congress gave then President Ramos to tackle frequent blackouts during his term.

The Ramos government skipped the strict requirements of public bidding in contracting private investors to build power plants. Investors were assured of payment for full plant capacity, whether such capacity was dispatched or not. Such an arrangement resulted in the high cost of electricity.

Casiño said Aquino should be wary of possible manipulators and saboteurs in the power industry who want the government to enter into contracts similar to those negotiated by the Ramos administration.

Casiño said the President should look into the claim of Mindanao Development Authority chair Luwalhati Antonino that certain companies in the power industry are manipulating supply in Mindanao to force electricity rates up.

As a long-term solution, he proposed the rehabilitation and expansion of the three hydroelectric power plants along the Agus River in the Lanao area.

Additionally, the government can build solar power plants, which take a lot less time to construct than those run by coal or oil and which are more environment-friendly, he said.

More burden

Electricity consumers in Mindanao will have to bear the brunt of a 50- to 80-centavo per kilowatt-hour (kwh) centavo hike in generation charge as expensive diesel and bunker oil-fueled plants will be used to plug the supply shortfall.

But power supply will decrease anew in April when a month-long emergency repair of the 120-megawatt Pulangi 4 hydroelectic power plant begins, officials said.

“The only way to solve the shortage is to bring in power that is more expensive... until 2014 when the new power plant will come onboard that is cheaper than diesel or bunker (fueled plants),” Almendras said.

To date, generation cost – which excludes transmission and distribution charges of the grid operator and local utility firms – is at P2.90 to P3.20 per kwh, data from the DOE show.

“Today there is still 100 MW coming from a power barge that is not being dispatched because it is not contracted,” Almendras said.

Meanwhile, the government will conduct an emergency repair of the Pulangui hydropower plant in Bukidnon. This is expected to further lessen supply in Mindanao.

“We will continue to experience the present levels of shortages up to May 9. We did not predict the need to shut down Pulangui” Almendras said. With Christina Mendez, Jess Diaz, Neil Jerome Morales


Noynoy admits gov’t goofed on power but not on his watch By Rocky G. Nazareno 03/27/2012

President Aquino admitted that the government was at fault for the worsening power supply situation in Mindanao but the catch is that past presidents, and not he, should be blamed.

Aquino admitted that signs of a looming power crisis in Mindanao may have gone neglected and it may even take as long as 30 months before repairs for a major hydroelectric plant and the construction of two coal-fired plants are completed.

“As what was in the papers, there is a problem about the power in Mindanao. Let’s admit it, it was neglected,” Aquino said in a speech during the birthday celebration of Cavite Rep. Erineo “Ayong” Maliksi Sunday night.

He explained that the delay in the implementation of repair work on units 1 and 2 of the Agus 6 hydroelectric plant, which produces a total of 75 megawatts (MW), may have been due to the high costs that was needed to undertake its rehabilitation.

“If you notice, we’re not talking about thousands or millions of pesos. (The repair work) is in the billions — P2.6 billion to repair units 1 and 2,” Aquino said.

He added that Agus 6, which is located in Fuentes, Iligan City, was commissioned in 1953 and has provided the region with power for the last 59 years.

“(Agus) has adequately served us and it is about time to replace (vital parts). In short, it now needs to be fixed,” the Chief Executive added.

According to him, the power crisis has left him wondering if adequate repairs had been done on Agus 6 as early as 30 years ago, “I wouldn’t have this problem.”

The two Agus 6 units were guaranteed to go on without repairs for 30 years or in 1983 before vital components should have been replaced. And yet, the country’s past presidents, including Mr. Aquino’s mother Corazon Aquino, did not order its rehabilitation.

But he said, “there is a problem with power shortage in Mindanao and what has been done to address it is not enough.”

Mr. Aquino pointed out that there are short-term solutions available in additional barges and more hydro-electric plants. But the costs for energy generated from these power plants would be higher compared to coal-fired and diesel-powered plants.

As it is, electricity sourced from the barges are at P14 per kilowatt hour (kwh) which is a lot more expensive than the P3 per kwh from diesel-powered plants while electricity from coal-fired plants is expected to cost less.

“So if we don’t want brownouts, we just have to accept this (the higher costs of electricity from the barges) until the construction of two coal-fired plants are completed in two years,” Aquino said.

Presidential spokesman Edwin Lacierda, in his press briefing yesterday, revealed that among the initial solutions to the higher costs of electricity would be “mandatory curtailment” where the use of power would stretched along a certain line of more areas that will result in lesser brownouts and the mix of electricity drawn from barges and hydro-electric plants for cheaper electricity.

The President also underscored that the solution to Mindanao’s crippling power crisis is not “as easy as changing a light bulb.”

“We’re going to change components in a hydro-electric plant. The coal-generating plants is all land as of now. We have to level the land before we could put up the building,” he explained.

But the President was candid enough to admit that “these are the facts and it will take long before we can fix the problem.

“I cannot tell you that I could not fix this problem because it came about even before my term. But what I can promise you is we’re doing something about this and we cannot always tell our countrymen to be more patient,” he said.

The President added that “it is the government’s job to see to it that the people’s patience is not always tested like this.”

Chief News Editor: Sol Jose Vanzi

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