The omnibus power reform bill has good intentions but some of its provisions will bring added woes to consumers and assure cronies of a new source of added wealth, Senate Minority Leader Teofisto Guingona said yesterday.
Guingona said the Senate minority will fight tooth and nail against the bill's provision that would pass on to consumers the stranded cost in the privatization of the National Power Corp. (Napocor).
The stranded cost refers to the debts of Napocor that would not be assumed by the buyers.
"The assets, as well as the liabilities, should be assumed by the buyers of Napocor. It will be greatly disadvantageous to consumers if they, and not the buyers, would pay for the debts of Napocor," Guingona said.
Proponents of the bill argue that passing on the debts of Napocor to consumers is nothing new.
Senate President Franklin Drilon said that many consumers might not realize it yet but they are already paying for some of the debts of Napocor.
Guingona, however, contested this view. He argued that what was being passed on to consumers were the government's obligations to independent power producers (IPP), not those of Napocor.
"The amount involved in the IPPs is very small -- it is about P3 billion only," he argued.
Napocor has a total debt of about P400 billion.
Sen. Juan Ponce Enrile has criticized the contract with the IPPs for being grossly disadvantageous to the government and for being one-sided in favor of the IPPs.
Guingona, on the other hand, justified the government's contract with the IPPs, which was negotiated during the Ramos administration. He said there was a severe energy crisis during the early months of the previous administration and this was adversely affecting economic activities and production.
Guingona said the contract with the IPPs might have some questionable provisions but he credited it for giving Philippine economic recovery the needed push
"It was a question of lesser evil. We had to bite the bullet, and the power crisis was eased," he added.
Going back to the omnibus power reform bill, Guingona said he would oppose it also because of the cross-ownership issue.
He explained that as currently drafted, the entities engaged in production could also be engaged in distribution.
"If the power producer also becomes the power distributor, then he will have the best of both worlds to the detriment of consumers. We should make sure that a distributor would remain a distributor and a producer, a producer. There should be no cross-ownership," Guingona said.
He predicted that some political cronies would enjoy cross-ownership should the efforts of the minority against the measure fail.