Concepcion urges Congress to amend EPIRA

Industrialist Raul T. Concepcion appealed yesterday to both Houses of Congress to amend the Electric Power Industry Reform Act (EPIRA) or Republic Act 9136 to avert looming power crisis in the country.

Concepcion, who is the chairman of the Consumer and Oil Price Watch (COPW), is asking Congress to grant the winning bidder of the National Transmission Corp. (TransCo) a 25-year franchise to operate.

The COPW head is also proposing that the government retain partial ownership of TransCo.

"The government should follow the Petron Corp. formula which will grant 40-percent ownership of TransCo to the winning bidder, 40 percent to the government, and 20 percent to the public.

He is also urging the lawmakers to reduce the mandatory privatization of Napocor assets from 70 percent to 50 percent. Thus far, only 19.5 percent of Napocor’s power plants have been privatized.

Concepcion said something should be done to make the Energy Regulatory Commission (ERC) truly independent so that its decisions will not be subject to review by the courts.

He is also pushing for the amendment of the Napocor charter (RA 8395) to remove the state-owned power firm’s exemption from the payment of taxes.

"This will bring the total installed capacity whose income tax holidays will expire in December 2006 to 83 percent and in December 2008 to 95 percent of installed capacity," he said.

He said the COPW is set to meet with Napocor officials to reconcile conflicting statements that Napocor will realize a consolidated net income of P85 billion in 2006 and a projected net loss of P48.8 billion in 2007.

"COPW commits itself to ensure full transparency and disclosure on the bidding process of the power plants being privatized, and that the safeguards to guarantee maximum value to the government are in place," he said.

Concepcion said existing power plants of the country are old and obsolete and cannot sustain the increasing demand for power.

He expressed fears that the country will experience power shortages as early as March 2008 when hydro-power plants expected to be operating at their lowest levels.

To make things worse, the 600-megawatt Mirant Sual (Pangasinan) coal-fired power plant broke down last Friday.

"It will take six to eight months to repair. This coincided with the scheduled maintenance of one unit of the 700-MW Mirant Pagbilao (Quezon) coal fired power plants. This forced Napocor to run power plants using the more expensive bunker fuel and diesel and to temporarily increase WESM (wholesale electricity spot market) prices," he said.

According to Concepcion, the amendments that he is proposing will encourage more foreign investors to bring in much needed capital to build new power plants to generate the additional 4,438-MW power requirements of our country up to 2010.