Mindanao governors have reiterated their stance against the national government’s plan to sell power facilities to private firms as a way to solve the energy crisis on the island.
During the Mindanao Power Summit last Friday, Davao del Norte Governor Rodolfo del Rosario, president of the Confederation of Provincial Governors, City Mayors and Municipal Mayors League Presidents (Confed), conveyed to the President the group’s stance against privatization of the Agus and Pulangi hydro-power complex.
Del Rosario even asked the President to certify as urgent amendments to the Energy and Power Industry Reform Act (Epira), but the President hardly listened when he told the summit that years of Mindanao’s cheap power were over.
On Monday, Aquino said he would be willing to have more dialogues with stakeholders in Mindanao’s power industry, but also hinted that privatization of the plants would be the best solution to the problem.
On Tuesday, the governors insisted on their positions – no to privatization, and a review of the Epira law.
Surigao del Sur Governor Johnny Pimentel said that instead of selling the power plants, government should rehabilitate them.
“It would be better for us stakeholders just to rehabilitate our power generation assets than privatize them,” Pimentel said.
Agusan del Sur Gov. Eddiebong Plaza said he feared that giving up government control and regulation over the plants would lead to unreasonable increase in power costs.
“My apprehension is that privatization might lead to unreasonable power pricing and result in monopoly,” Plaza said.
Agusan del Norte Gov. Erlpe John Amante said privatization would mean higher power costs that would work to the disadvantage of Mindanao’s ability to attract the much-needed investments.
“Privatizing the power plants, which currently provide us cheaper source of power, would lose Mindanao’s advantage to attract more investments because power cost would surely increase in that event,” Amante said.
South Cotabato Gov. Arthur Pingoy, on the other hand, said people would suffer the high cost of electricity if these power plants were privatized.
“We already passed a resolution for our position. Definitely, once these are sold to private companies, electricity cost will increase,” Pingoy said.
North Cotabato Gov. Lala Taliño-Mendoza expressed the hope the President would listen to them eventually.
“We wish he (Aquino) would take a second look at our resolution,” Mendoza said.
Davao del Sur Gov. Douglas Cagas agreed, saying: “He already heard the sentiments of the people of Mindanao during the summit. Although he has the power to exercise as President, he must also review our resolution.”
Del Rosario on Friday said the National Power Corp (Napocor) should rescind the Operational Management Agreement (OMA) with the Power Sector Assets and Liabilities Management Corp (PSALM), which required Napocor to remit all its gross receipts to the latter, including those coming from the Agus and Pulangui hydropower complex.
“It is high time that Napocor should rescind this contract, and be allowed to run its affairs, which will include the rehabilitation of the Agus-Pulangui plants to their full capacity, using the internally generated revenues,” Del Rosario said.
“Let’s shatter the myth that the Napocor and the Agus-Pulangi complex are a losing proposition,” Del Rosario said, even as he laid down the nine-year annual income of the government power generation firm, which posted an annual gross generation average of P36.9 billion, with an average profit margin of P73.2 billion.
Del Rosario also said Epira has not worked for the island of Mindanao in the last 11 years and that its implementation should now be reversed, hence, the President should certify its amendment as urgent in Congress.
“We firmly believe that rescinding this OMA is the first step in ‘daang matuwid,’ that all our medium- and long-term solutions hinge on our proposed amendment of the Epira, and that the President should certify as urgent the needed amendments to the Epira,” Del Rosario said.
The Davao del Norte governor added that the present situation would only turn from bad to worse should the government sell these power plants to private energy firms.
“It is bad enough as it is. It will be intolerable once it is surrendered to the private sector,” he said.
Del Rosario also called on the reclassification of the power generation sector as “utilities” and place caps on these firms’ profits. He said some independent power producers (IPPs) have earned up to 50 percent return on rate base, “which is too much.”
“Just a one-centavo-per-kilowatt-hour increase imposed nationally translates into a P670-million annual income,” said the governor, adding President Aquino should now appoint a Mindanao consumer group representative to the Energy Regulatory Commission.
Misamis Oriental Gov. Oscar Moreno said the Power Summit in Davao City opened the discussion between the government, the electric cooperatives and the stakeholders. “We should pursue the discussion, that is the best we can do,” Moreno said.
Meanwhile, the Bagong Alyansang Makabayan (BAYAN) Southern Mindanao Region called as “anti-people” the President’s solutions to the energy crisis in Mindanao.
“Mr. Aquino, you are presenting a no-win solution for the people by asking us to choose between higher electricity rates or rotating brownouts, either of which will provide public relief. The simple truth is our country is deep into the quagmire of poverty that the people can no longer afford humane living conditions,” said Sheena Duazo, spokesperson of Bayan Southern Mindanao.
Bayan has consistently opposed the passage of the Epira law in 2001, and has called for its repeal after it was passed in Congress.
“Mr. Aquino voted against the passage of Epira in 2001 as Tarlac representative. Today, he lauds these corporations and shields their interests as these companies lash out on consumers,” she added.
She also said Epira also led to the selling of power barges 117 and 118 to the Aboitiz-owned Therma Marine Inc., which could have augmented Mindanao’s power supply, thus creating conditions for the artificial power crisis.
