As example, BBM can slash power rates in home region

Presidential influence is boundless. Bongbong Marcos Jr. can sway electricity generators to halve rates where it is costliest – Leyte-Biliran-Samar. That will spur commerce and industries in Region 8, among the country’s poorest, from where his mom hails. Generators elsewhere will follow suit, to be on his good side.

Asia’s highest power rates will thence drop. The biggest block to investors finally will melt. Livelihoods will thrive. Turning around the economy will be Marcos Jr.’s legacy. Let it not be said that he had that one chance yet blew it.

Waray-land’s main generator is GNPower Dinginin. Owned by Aboitiz Power, the coal plant supplies all 11 electric cooperatives there.

Convincing Aboitiz Power to slash rates should be easy. Chairman Sabin Aboitiz leads Marcos Jr.’s Private Sector Advisory Council. PSAC billionaires counsel the President on the economy. The tycoons made Sabin their head not only because of his closeness to Marcos Jr. but also for his congeniality.

Marcos Jr. knows the power of influence. Last August, he got the Big 3 mall chains’ 2,000-plus outlets to retail sugar at only two-thirds its price per kilo.

Once convinced by Marcos Jr., Aboitiz Power can scrap its “pass-through” provisos in power supply agreements. Such provisos allow it, like most other generators, to raise charges at will. Distributors and co-ops pass on the increased charges to customers.

The Energy Regulatory Commission approved the pass-through deals.

The National Association of Electricity Consumers for Reforms has long been begging ERC to abolish the pass-throughs. Founder Pete Ilagan calls them “illegal, unreasonable, onerous.” They violate the 2001 Electric Power Industry Reform Act.

EPIRA requires power rates to be “at the least cost to consumers.” Pass-throughs include variable expenses like rising cost of coal, diesel and bunker – even operational inefficiencies.

Ilagan complained anew against the pass-throughs last April 26 to then-ERC chairman Agnes Devanadera. He cited runaway generation charges to Leyte Electric Cooperative (Leyeco)-II, Biliran Electric Cooperative (Bileco) and Samar Electric Cooperative (Samelco)-II.

The Supreme Court declared in 2006 that pass-throughs negate EPIRA’s least-cost policy. Ilagan reiterated this on Oct. 3 to new chairman Monalisa Dimalanta.

His pleas “falling on deaf ears,” Ilagan wrote Marcos Jr. on Oct. 10 to denounce the pass-throughs.

ERC then rejected a joint plea of Meralco and two San Miguel Corp. generators for slight, temporary rate increases in Greater Manila. Unlike nine other Meralco suppliers, SMC’s two coal plants have no pass-through escalation clause. But they need a six-month breathing spell from multibillion-peso losses due to the quintupling of coal prices with the Indonesian export embargo and the Ukraine invasion.

Ilagan wondered why ERC ignored SMC’s coal woes. Only last June 20 Devanadera had explained the “high cost of electricity” in Leyte-Biliran-Samar. It was due to GNPower Dinginin of Aboitiz Power, among others, “using coal.”

Ilagan on Oct. 24 asked Marcos Jr. to “ban illegal pass-throughs.” He pointed out that SMC’s generators are Meralco’s second and third lowest suppliers at P4.05 per kilowatt-hour. In contrast, Thai-owned Quezon Power with an escalation pass-through, charges triple, P13.34.

Marcos Jr. can persuade Aboitiz Power to match in Leyte-Biliran-Samar SMC’s P4.05/kWh in Greater Manila.

Pressuring ERC to do the rate slashing would be an abuse of presidential power. Although the President appoints the chairman and four commissioners, ERC should be an independent quasi-judicial body.

Persuading Aboitiz Power is also better than pressuring the Court of Appeals. Marcos Jr. had called “unfortunate” the CA’s intention last week to review ERC’s rejection of the Meralco-SMC petition. Think-tank Infrawatch convenor Terry Ridon cautioned him against interfering in judicial proceedings, a breach of constitutional separation of powers.

Marcos Jr.’s fellow-Leyteño, Ilagan obtained from ERC GNPower Dinginin billing statements in Region 8. Generation charges are detailed:

(1) Leyeco-I (Don Orestes Romualdez Electric Cooperative) – P11.48/kWh in Nov. 2022. Up from P5.63 in Nov. 2021.

(2) Leyeco-II – P9.27/kWh in May 2022. From P5.63 in Nov. 2021.

(3) Leyeco-III – P9.98/kWh in July 2022. From P5.53 in Oct. 2021.

(4) Leyeco-IV – P10.61/kWh in June 2022. From P5.71 in Nov. 2021.

(5) Leyeco-V – P9.83/kWh in July 2022. From P5.56 in Oct. 2021.

(6) Bileco – P10.23/kWh in July 2022. From P5.58 in Oct. 2021.

(7) Southern Leyeco – P10.26/kWh in July 2022. From P5.49 in Oct. 2021

(8) Samelco-I – PP10.90/kWh in June 2022. From P5.94 in Oct. 2021.

(9) Samelco-II – P11.17/kWh in June 2022. From P6.20 in Oct. 2021.

(10) Eastern Samelco – P10.67/kWh in July 2022. From P6.04 in Oct. 2021.

(11) Northern Samelco – P10.96 in June 2022. From P5.67 in Nov. 2021.

This week SMC offered its plant at only P1/kWh if Meralco gets natural gas as fuel. Natural gas is a State wealth. Marcos Jr. can ask Aboitiz Power facilities that use geothermal, another State wealth, to match SMC’s P1.

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