Gov’t urged to keep Mindanao hydro complex

The Department of Energy (DoE) and legislators from Mindanao asserted again their stand that the government must not sell the highly crucial 700-megawatt Agus-Pulangi hydropower complex.

In a briefing last week, Energy Undersecretary Josefina Patricia Asirit noted that the position of the Mindanao legislators could be supported by certain provisions in the law, specifically Section 47d of the Electric Power Industry Reform Act of 2001 (Epira), or Republic Act 9136.

“It depends on how they will read the law because it states there that the ‘Agus and the Pulangi complexes in Mindanao shall be excluded from the generation companies that will be initially privatized. It now depends on how the Joint Congressional Power Commission will appreciate it or what its direction will be,” Asirit explained.

Section 47d of the Epira, according to Asirit, provided that the ownership of the Agus and Pulangi power complexes “shall be transferred to the (Power Sector Assets and Liabilities Management Corp.) and both shall continue to be operated by the (National Power Corp.).”

“Said complexes may be privatized not earlier than 10 years from the effectivity of this (Epira) Act, and except for Agus III, shall not be subject to Build-Operate-Transfer (BOT), Build-Rehabilitate-OperateTransfer (BROT),” the section read. “The privatization of Agus and Pulangui complexes shall be left to the discretion of PSALM in consultation with Congress.”

On the part of the DoE, Asirit confirmed that they have not, since last year, changed their position that recommended the deferment of the sale of the complexes as these provide a huge chunk of the power supply in Mindanao. Hydropower sources provide more than half of the island’s electricity requirements.

Energy Secretary Jose Rene Almendras earlier urged the JCPC to issue within the year its decision on whether or not the government would proceed with the sale of the Agus-Pulangi complex so that the DoE “can finally move on.”

Almendras made the assurance that whether JCPC decides to privatize the facilities or not, the DoE has proposals that could ensure the increase in the productivity of the biggest hydropower complex in Mindanao.

Almendras earlier explained that should the Agus-Pulangi hydropower complexes be put up for auction, the DoE would include certain trading and ownership provisions and even technical considerations on the use of must-run and ancillary facilities, which should all be followed strictly.

In case the JCPC decides not to push through with the bidding of the hydropower complexes, the DoE would ensure that the continued ownership of the Agus and Pulangi will not be a burden, Almendras had said.

“If these facilities will not be put up for auction, we can sell the concession instead. We can also seek an operation and maintenance contract or rehabilitate it. There are many options,” he explained.

The private sector has been urging the government to proceed with the outright asset sale of the Agus-Pulangi hydropower complex in Mindanao, noting that any other forms of privatization would not be economically feasible and might unnecessarily increase power prices on the island.