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Solon urges Duterte to review PSAs amid brownouts


By Ellson Quismorio 

Bayan Muna Party-list Rep. Carlos Zarate is calling on President Duterte to order regulatory bodies, particularly the Energy Regulatory Commission (ERC), to review several pending Meralco-linked power supply agreements (PSAs) for coal-fired power plants.

Rep. Carlos Isagani Zarate (Bayan Muna Party list Facebook page / MANILA BULLETIN)

Rep. Carlos Isagani Zarate
(Bayan Muna Party list Facebook page / MANILA BULLETIN)

He made the call as Makabayan bloc solon expressed worries that consumers might end up as “hostage” to the falling power reserves in Luzon and eventually bear the burden of these supposedly onerous deals. The falling power reserves have resulted in widespread brownouts in Luzon, including Metro Manila.

“Ang panawagan natin kay Pangulong Duterte, ipa-review itong existing power supply agreements (Our appeal to President Duterte is for him to have these existing power supply agreements reviewed),” Zarate said.

Incidentally, Friday was the third straight day that the Luzon grid was placed under red alert status, leading to rotating brownouts in some areas.

“Nababahala tayo doon sa statement noong nakaraang araw ng Meralco na dapat nang buksan talaga ang nakabinbin na power plant applications, especially coal-fired power plants (We are concerned over Meralco’s statement the other day that these power plants with pending applications, especially the coal-fired power plants, must be opened),” Zarate said.

“We know that up to now, there are seven PSAs from Meralco that are questionable. We appeal to the ERC to not be pressured into approving these seven PSAs, he said.

The PSAs that Zarate are referring to are connected to these Meralco sister generation companies: Redondo Peninsula Energy, Inc. (which is applying for a 225-megawatt [MW] plant); Atimonan One Energy, Inc. (1,200 MW); St. Raphael power Generation Corporation (400 MW); Central Luzon Premiere Power Corporation (528 MW); Mariveles Power Generation Corporation (528 MW); Panay Energy Development Corporation (70 MW); and Global Luzon Energy Development Corporation (600 MW).

“Our appeal is that the ongoing power supply situation in the Luzon grid shouldn’t be turned into a hostage situation just for the purpose of approving these anomalous PSAs, the congressman said.

Zarate said that the House Committee on Good Government and Public Accountability’s past inquiry on these seven power deals proved that they were “anomalous, disadvantageous to consumers and not compliant with ERC’s own rules.”

“All PSAs should undergo a Competitive Selection Process,” he noted.

According to the Bayan Muna congressman, Atimonan One’s reported P15 billion interest on loans as well as the increased cost on imported equipment would translate to a P1.80 per kilowatt hour (kwh) increase in capacity cost. This would raise the plant’s power rate to P7.46 per kwh.

“This would be exorbitant compared to other players who offer electricity for as low as P2.95/kwh,” pointed out Zarate.

Summer shutdowns 

The PSAs have been pending before the ERC since April 2016.

Meanwhile, the Davao-based solon also found it strange how the same group of power plants simultaneously suffer shutdowns during summer, thereby exacerbating the power supply situation.

Zarate said that among the plants that have been bogging down since 2012 come summer time are Sual power plant, Calaca power plant, Pagbilao power plant, and Malaya thermal power plant.

“Why is it that they always have to break down at the same time when demand is highest? Di talaga masisisi ang consumers na mag-isip na niluluto ito para tumaas ang singil sa kuryente (We really can’t blame the consumers for thinking that the power plants are colluding in order to raise the cost of electricity),” he said.

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