Showing posts with label ERC. Show all posts
Showing posts with label ERC. Show all posts

Wednesday, March 19, 2014

Workers want full prohibition not a compromise deal on power rate hike

20 March 2014
 Organized labor under Nagkaisa is insisting for no less than the full prohibition of the December 2013 and January 2014 rate hike, rejecting in effect the Philippine Electricity Market Corporation’s (PEMC) recomputed rate that is 80 percent lower than the approved market rate in December and January.
 PEMC, which operates the Wholesale Electricity Spot Market (WESM), said on Tuesday that it had finished its recalculation of market prices in compliance with the Energy Regulatory Commission (ERC) order of March 3.  For the December 2013 billing, it set the new spot market rates at P6.007 (76.35 percent lower) than the P25.404 per kWh, and P6.246 (77.98 percent lower) than the original P28.367 per kWh for the billing month of January 2014. 
 “The numbers are out and PEMC’s recomputed rates bared all the elements of market failure.  We insist that any residual cost coming from this failure must be deemed unjust and therefore should not be passed on to consumers,” said Wilson Fortaleza of Nagkaisa power team. 
 Fortaleza, who is also the spokesperson of Partido ng Manggagawa (PM), argued further that in this particular case, the market failure was also a result of regulatory failure the more it should not be borne by the consumers.
 He pointed specifically to the failures of the ERC and PEMC to regulate the market despite the expected tightness in supply due to the Malampaya shutdown and also being aware of official reports citing repeated occurrence of market abuse since WESM started operating in Luzon in 2006; and the failure on the part of the Department of Energy (DoE) to ensure reliable supply of power and impose sanctions on erring power plants. 
 Tomorrow, Nagkaisa and the Power to the People (P2P) network will stage a picket rally at the PEMC to call for the suspension of WESM operations, saying it is not the consumers but the rich owners of generation and distribution companies who profitably gain from this fraudulent trading scheme.
There are also reports that the PEMC Board, who are not independent but made up of the players themselves, receives fat compensations and other perks, including brand new service vehicles.

“We challenge the government to tell the people the truth that WESM won’t work in a very small and highly concentrated market ruled by certified predators in the power industry,” concluded Fortaleza.

Monday, December 9, 2013

P4.15/kWh power hike is bonus for doing nothing – labor group

09 December 2013

Just for doing nothing, Meralco and several generation companies (Gencos) were rewarded a whooping bonus of P4.15/kWh, the labor group Partido ng Manggagawa (PM) said in a statement.
According to PM, the impending increase, the highest in the country’s history and in the world, could have been avoided had Meralco and gencos planned for replacement power to address the expected load gap from Malampaya’s scheduled regular maintenance.
“But in a privatized industry regime under EPIRA, power utilities earn handsome profit just by doing nothing and even during times of calamities. Power utilities like Meralco control the whole industry from generation to transmission to distribution and can thus exercise monopoly pricing limited only by what the market can absorb, meaning what the consumers are willing to pay in exorbitant electricity costs,” said PM spokesman Wilson Fortaleza.
About 2,700 MW of power from Sta. Rita, San Lorenzo, and Ilijan plants were lost due to the shutdown of Malampaya. Luzon needs at least 6,000 MW to meet its peak load demand.
“Imagine a deficit of 2,700 megawatt, an anticipated crisis, yet Meralco and Gencos did nothing but wait for the billing period and impose their new and adjusted rates,” lamented Fortaleza.
The group, which joined the Freedom from Debt Coalition and Nagkaisa in a picket held at the ERC this morning, added that the crisis is made worse when the government, particularly the Department of Energy (DoE) and the Energy Regulatory Commission (ERC), “stood idle in the face of the surging tsunami of price hikes in the electricity market.”  The government should have disallowed other power plants to shutdown simultaneously with Malampaya to ensure stability of supply in the Luzon grid.
Fortaleza explained that replacement power is a global template for every power supply contract since outages, both regular and forced, is routine in the power system. In many PSA’s the obligation to find replacement power or plan for alternative set up belongs to Gencos since they have contracts to comply in ensuring reliable supply of power to their customers. 
Unfortunately, said Fortaleza, most of ERC-approved PSAs assigned replacement power to Meralco and the Wholesale Electricity Spot Market (WESM), where spot prices which as of yesterday range from P17/kWh to P52/kWh.
Fortaleza added that Gencos have options to avoid the instability and he cited the case of Sta. Rita and San Lorenzo.  Based on First Gen’s submission to the Philippine Stocks Exchange (PSE) on March 20, 2012, it explained that,“Although the Sta. Rita plant is intended to operate on natural gas, if delivery of natural gas is delayed or interrupted for any reason, the plant has the ability to run on liquid fuel for as long as necessary without adverse impact to its operation or revenues.” The same business model goes with San Lorenzo.
Now did Gencos, Meralco, and the government considered this option?
“No, they just did nothing,” concluded Fortaleza.

Friday, February 20, 2009

Workers oppose power rates hike

20 February 2009

The labor partylist group, Partido ng Manggagawa (PM), denounces the Energy Regulatory Commission for granting the National Power Corporation a provisional authority to increase its tariff rates by as much as P1.00/kwh beginning this month, even as the grounds for such a petition are yet to be deliberated in subsequent public hearings, the first of which, the pre-trial hearing, is yet to convene on February 24.

The provisional authority allows the Napocor to charge the distributors (DUs) an increase by an average 46.82 centavos per kWh in Luzon and 71.47 centavos per kWh in Mindanao. The increase, according to Meralco will translate to 17 centavos for Luzon customers or an additional P34 for those who consume 200 kWh per month.

The biggest increase, an average of P1.146 per kWh, will be in the Visayas region, whose people, in particular the poor people of Negros, are facing another tiempos muertes – a period in a year where the region encounter the highest incidence of hunger. The rate increase will take effect in the February 26 to March billing period.

The petition for rate adjustments, according to the Napocor, is intended to recoup its losses from giving incentives to consumers such as the mandatory rate reduction of 30 centavos provided under EPIRA. It also has to comply with a rate of return as required under its loan covenant with the World Bank and the Asian Development Bank.

According to the ERC, this increase would remain provisional and could still change depending on the outcome of the hearings the state regulator will be conducting on the state generator’s application for the rate increase.

But the labor party complains that the ERC is committing another abuse of discretion by issuing such a provisional authority to a petition that is yet to be heard and in complete disregard of the current conditions of the Filipino people who are already reeling from the impact of the raging global economic crisis.

“Why the haste in giving out a provisional authority and why so callous in rendering almost a blanket approval of the Napocor petition,” protested PM secretary-general Judy Ann Miranda, in a statement sent to media.

Miranda said the new power rate increase bares with it the gross insensitivity of the government to the plight of the workers and the poor who are now facing massive job loss, wage cut, and work flexibilization schemes due to the crisis.

The labor group said the power rate increase, coupled with the government’s failure to address the pressing problems of displaced and unemployed workers, is fanning labor unrest in many regions of the country, thus protests in days ahead are to be expected.

“In its petition with the ERRC, what the Napocor has in mind is its loan covenant with the World Bank and the ADB, not its social contract with the consumers. This is not only callousness but cruelty bordering to treason,” concludes Miranda.