Only two things about the recent posturing of this cute administration on the increase in electricity rates worry us down here in my neighborhood.

Other than those, we are delighted to live in this country that boasts of having the second highest electricity rates in all of Asia.

Okay, remember that sensational speech of the Grandma at the Palace last week before business groups?

She called on the business sector to join this cute administration in some legal exercise to force the power retailer Manila Electric Co. (Meralco) to reduce our monthly electric bills.

As if, in this country where dissent can mean you should just disappear without a trace, the chief executive is helpless against a utility firm.

Anyway, what worries us down here has something to do with the Grandma?s revelation about the state-owned virtual-monopoly electricity producer National Power Corp. (Napocor).

The Grandma said she ordered Napocor to cut its electricity prices, which it charges to distributors like Meralco, which in turn pass on the Napocor costs to us.

Napocor responded by saying that it could do much better than the Grandma?s suggested rate (more than P4 a kilowatt-hour) by going down to P3.50 a kWh.

Now, on the open market for electricity, called WESM, or wholesale electricity spot market, Napocor quotes its selling price at more than P6 a kWh.

As I said, only two things here:

One, if Napocor can in fact afford such a drastic cut, then it must have been charging power distributors, and thus all of us, with highway robbery rates all along.

Two, if Napocor was pulling the Grandma?s leg, and its cost is higher than its bragging rate of P3.50 a kWh, at such a price it can only lose its pants and underwear.

Uh-oh, this simply means subsidized electricity rates again. Let us pray.

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At the start of this cute administration in 2002, the Grandma also forced a cut in the Napocor rates, amounting to only 80 centavos a kWh.

Again?that was only 80 centavos. The showoff Napocor now wants to cut it by more than P2.

The Grandma?s brilliance in 2002, as we all know, resulted in massive losses for Napocor of about P110 billion in 2003 and another P100 billion in 2004.

By 2003, therefore, Napocor?s debt reached P1.2 trillion, forcing the national government to absorb P200 billion of it.

Guess who now pays for the P200 billion in Napocor debt. Hint: not the power industry mafia, which according to insiders is made up of certain persons with the initials GD, TA, FR, MO and CC.

Even after its assist pass of P200 billion in debt to the national government, Napocor?s outstanding debt, and even considering the foreign exchange gains from the peso?s strength, remains at eight times this cute administration?s budget for education.

Put another way, the debt is equivalent to 90 times (not a typo) the budget for health.

Now, if that P0.80-per-kWh subsidy six years ago buried us alive, where will the subsidy of more than P2 a kWh end us up this time?

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What is more, such a subsidy in electricity does not really benefit the less fortunate down here in my neighborhood.

Here are the facts: Our richest citizens in Classes A and B, making up about 11 million residential users of electricity, eat up roughly 92 percent of the electricity used by all households.

The rest of us?about 70 million people?use up only eight percent.

Who benefits the most from the subsidy again?

Well, mostly those who have 24/7 air-conditioning in their homes, plus swimming pools and Jacuzzis, etc. Thank you, boss!

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That is why, according to our lawmakers?well, at least, the bright ones?the solution to our debilitating high power rates was not such a subsidy, but a total overhaul of the power sector.

Thus they crafted the Electric Power Industry Reform Act (EPIRA), which aims mainly to foster competition in the power business, by forcing the government (i.e., Napocor) to stay out of the sector for good.

To sort of create open competition, the EPIRA wants Napocor to reduce its share in the country?s total generation capacity to 30 percent at the most.

Today, Napocor still controls about 75 percent, including its contracts with IPPs, the so-called independent power producers.

And now the mafia is lobbying in Congress to amend the EPIRA by changing the Napocor?s threshold from 30 percent to 50 percent.

To think, our public officials, lawmakers included?well, at least, the ill informed ones?seem to be biting the mafia?s gambit.

Yet nobody in his right mind in the private sector will ever want to invest in a market in which one entity (a government entity, at that) controls half of the supply.

That is repulsive to foreign investors, for one.

Well, a government firm does not pay taxes. Also, its pricing is set mainly by political concerns. You know?it?s not really a business.

Why do you think the Grandma wants Napocor to go back to subsidized rates?

* * *

Still, it?s another story when the likes of Government Service Insurance System (GSIS) president and general manager Winston Garcia make noise to protect their investments in a utility firm like Meralco.

Garcia says that he is not out to take over Meralco from the Lopez group.

Actually, the GSIS owns 25 percent of Meralco, entitling it to four seats on the Meralco board, only one less than the Lopez group?s five.

Garcia was saying that even with such a presence on the Meralco board the GSIS could not access documents, including the contracts between Meralco and some entities rumored to be closely associated with some Meralco executives.

Down here in my neighborhood, we also think that if as he says he is only fighting for full transparency and good corporate governance?and not out of some political machinations of this cute administration?he is up for another high profile fight.

For instance, Garcia questions Meralco?s charges called ?systems loss? to cover pilferage and heat loss in the transmission.

He believes that it is unfair to the Meralco customers, since everybody else pays for what probably some powerful influential people steal from Meralco.

According to Garcia, the public perception is that Meralco is not doing enough to crack down on pilferage.

Garcia also wants Meralco to open its books to the board members, including its alleged purchase of a Bahamas-based firm that got Meralco?s reinsurance contract.

In other words, Garcia wants the GSIS to get more out of its investment in Meralco. You know?for the good of the millions of GSIS members.