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Despite staggered rate hike, solons want Meralco probed

By: - Correspondent / @inqmindanao
/ 07:50 AM December 08, 2013

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CAGAYAN DE ORO CITY, Philippines—The Manila Electric Co.’s announcement that it would implement the P3.44 per kilowatt-hour generation rate increase on a staggered basis should not preclude an investigation into the “proposed humongous power rate hike,” militant party-list members said.

Party-list Representatives Neri Javier Colmenares and Carlos Isagani Zarate (Bayan Muna) have formally asked the House of Representatives, through House Resolution No. 588, to investigate the rate increase that Meralco aims to implement this month.

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Following outraged reactions from consumer and advocacy groups, Meralco announced on Friday that it would implement the P3.44 per kwh increase in tranches, starting this month.

“This planned power rate increase is obviously artificial and contrived. Considering that the supposed maintenance shutdown of the Malampaya natural gas plant between Nov. 11 and Dec. 10  was scheduled long ago, other cheaper sources could have been used to compensate without imposing an additional burden on our people,” Zarate said in a statement.

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There could be no doubt that the increase was “clearly planned,” he said.

Zarate wondered what happened to the Department of Energy’s plan, under which are listed various alternative sources of power when major power plants have to undergo maintenance shutdowns.

Price manipulation

“Since the maintenance of the Malampaya power facility was scheduled months ago, it is gravely suspicious why the DOE did not find alternative sources to compensate for it. Repairs and maintenance of power plants are scheduled events,” he said.

One can only suspect that the supposed shutdown of the major power plants was “deliberately aimed at manipulating the prices of the Wholesale Electricity Spot Market (WESM),” Zarate said.

“We should be wary of this supposed scheduled maintenance of power plants,” he said, adding that officials of the Energy Regulatory Commission (ERC) need “to keep their eyes wide open and put their ears to the ground and watch out for signs of price manipulation.”

Zarate maintained that there was no reason to increase power rates when power plants undergo maintenance shutdowns.

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“An investigation is definitely in order, considering that we have had enough calamities for the year. Meralco should not be callous by adding to our woes,” he said.

He suggested that the government take control of the power industry again as it was clear that private utilities were after profits and the supposed maintenance of privately operated power plants was purposely being done “to constrict supply and therefore jack up prices in the spot market.”

The Malampaya power plant is operated by Shell Philippines Exploration with its partners Chevron and the Philippine National Oil Co.

“Of course, it would be better if the energy sector is once again regulated, its control returned to the government so that this kind of problems would not arise. As it is now, the private operators are the ones decisive in the whole spectrum of the energy industry, including plant maintenance, and they can create an artificial energy crisis if they want to,” Zarate said.

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TAGS: Malampaya, Manila Electric Co., Meralco, Power Rate Hike
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