Mindanao power utilities nix sale of hydro plants

MANILA, Philippines - If the national government cannot come out with a privatization plan for at least five hydro-electric plants in Mindanao that assures consumers that electric rates will not go up to levels in Luzon and the Visayas, it would be best not to sell those plants.

This was the stand advanced by the Alliance of Electric Service Companies in Mindanao in letters sent recently to the Department of Energy, the Energy to the Regulatory Commission, the Joint Congressional Power Committee and to the chairmen of the energy committees in both houses of Congress.

A copy of those letters addressed to Rep. Lorenzo Tanada III, was signed by alliance president Melvyn D. Eballe.

“It is the low-cost generation of the Agus-Pulangi hydro plants that keeps the average rates of electricity in Mindanao lower than in Visayas and Luzon. The process of privatization, if carried out by government, should be done in such a manner as to maintain the low rates of generation of the Agus-Pulangi hydro plants,” the alliance head said.

“If no scheme of privatization could be developed that would maintain low rates of electricity in Mindanao, then it would be better for Mindanao if the Agus-Pulangi hydro plants are not privatized, and continue to be owned by government,” he said.

In the meantime, the group of electricity distributors likewise asked the concerned government agencies to unbundle electric rates in the southern region, separating the cost of generation of hydros and non-hydro power generators to enlighten the consuming public.

They lamented the inaction of the government over the present electric power shortage in the region that has resulted in daily outages since last year.

As early as 2010, Eballe said that his group has suggested ways of solving the power crisis but the government has not acted on any of them until now. He blamed the PSALM-NPC’s inaction as the main culprits in the rotating brownouts in Mindanao.  – PHILEXPORT News and Features