MISREADINGS
Private and exclusive
The passage into law of the Electric Power Industry Reform Act in 2001 opened the floodgates for the full privatization of the country’s power industry. The fundamental aim of the law is to open the market of the power sector to interested investors with the hope that it will establish open market competition which, in effect, will result to efficient delivery of electricity to consumers and bring down rates.
It was also believed that with the new policy environment, reforms in the various aspects of the power industry operations from generation of electric power, transmission, down to distribution of electricity to consumers will be made possible.
The passage of the law was likewise expected to address the complex problems plaguing the power industry. These problems ranges from financial losses and indebtedness of the state-owned and operated National Power Corp.; commitments and obligations enshrined in the contracts between power distribution companies and its private independent power producers like the “take-or-pay”; sovereign guarantees by the National Government; corruption; high electricity rates; and people’s lack of access to electricity.
However, nine years after the law was passed and privatization moved in its own phase – consumers are confronting the same set of problems especially on the issue of high rates, and worse, the inability of power distribution companies to provide uninterrupted supply of electricity to its customers.
In Iloilo City, for instance, electricity consumers are experiencing an average of two to three hours power blackout each day distributed in different times of the day and in different areas of the city. Yet, for residential consumers alone, electricity rates in the city costs P13.30 per kilowatt-hour. . (PECO, in its statement last week, says it charges P12.95 per kWh – ed.)
The electricity bill of Iloilo City consumers is more expensive compared to other key cities in the archipelago which are considered more progressive and with electricity demand intensive industrial-based consumers. Iloilo City is pre-dominantly residential-based in terms of consumers and with an economy that is services driven.
The main feature of the city’s power industry is privately-owned even before the passage of EPIRA. The local power industry has moved to fully privatize power services by contracting electricity from its sister company – the Panay Power Corp. – an independent power producer that supplies 72-MW electricity to Panay Electric Company.
This makes Iloilo City an example of what power privatization is all about and what is being expected by consumers outside the city under the “cooperatives” for they will soon get electricity from a private provider. These cooperatives and its consumers are in the process of becoming like “PECO-PPC-Iloilo City consumers.”
On electricity rates and quality of service alone, it can be gleaned from the experiences of Iloilo City consumers that EPIRA did not establish the policy environment which is pro-competition, pro-people, and pro-consumers. No matter how government dresses up the concept of privatization, its monstrous image emerges and will continue to emerge at the expense of the people. For this reason it is worth contemplating that “private” does not necessarily mean cheap and better service.
Email: peoplesdomain@yahoo.com
