Emergency powers must be time-bound, clear-cut

Congress must set time-bound and clear-cut parameters to the emergency powers being sought by President Benigno Aquino III to address an expected shortfall in electricity supply in the Luzon grid by next summer, New York-based think tank Global Source said.

“Our best case here is a well-studied, time-bound resolution, clearly defining the parameters of the authority granted to the Chief Executive that leaves little room for perceptions of abuse of powers to arise,” the think tank said in a research note dated Oct. 3 authored by Filipino economists Romeo Bernardo and Marie-Christine Tang.

The request for emergency powers is among the three legislative imperatives closely monitored by Global Source given their crucial role in keeping confidence and economic growth up in the very short term as well as over the longer haul.

Another item on Global Source’s list is the Bangsamoro Basic Law (BBL), which it tagged as a “medium-term game changer on security and economic grounds” while the third is the General Appropriations Act (GAA), the government’s budget for 2015.

On the request for emergency powers, Global Source said that while a favorable joint resolution was likely within this month, the burning issue would be powers could be granted amid a tug of war between private players and the energy department over the best option for filling a projected 600-megawatt power deficit.

Most private sector players believe that a well-managed Interruptible Load Program (ILP) that aggregates private companies’ self-generating capacities, together with energy conservation measures and more prudent plant management (including plant rehabilitation and scheduling of maintenance shutdowns), will be enough to close the gap. Commitments to the ILP are for now less than 150 MW—about a tenth of available capacity—but the business sector is hopeful that with the government providing the proper incentive framework, more will sign up.

“Overall, the main attraction of this packaged option is that government’s role is less heavy-handed and the ILP kicks in only at particular points in time, thus keeping added costs to a minimum,” Global Source said.

While Energy Secretary Jericho Petilla openly recognizes the value of these measures, the think tank sees him less confident that the ILP can produce the needed volume, thus preferring that the government contracted additional capacity to guarantee adequate supply.