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It’s about time Malacañang stepped in

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OPINION and OPTION 

By ELINANDO B. CINCO

Elinando B. Cinco

Elinando B. Cinco

Will the Energy Regulatory Commission (ERC) exercise its emergency powers to resolve the power emergency in Zamboanga City?

It is a question that begs an immediate response, especially now that a dispute is lodged before the commission. It is also a major challenge that Malacanang can no longer ignore, as I’ve warned in an earlier column.

To recall, the power impasse stemmed from the inaction by the Zamboanga City Electric Cooperative (Zamcelco) in February to settle its arrears amounting to more than P300 million with power supplier Western Mindanao Power Corp. (WMPC). The latter  said it could no longer advance the amount needed to purchase fuel to run its power plant

The situation has now become dire and the costs – both economic and political – are increasing. And if no intervention happens soon, the power problem can reach crisis proportions

Take the sardine canneries, for instance. It has come to the attention of many that these companies, providing what can be considered a basic household item, are manufacturing 30 percent less than before the power outages.

One cannery operator said he is spending between P3 million and P4 million a month on generator sets to ensure uninterrupted power.

If such a situation continues, these canneries may eventually pass on to consumers nationwide the resulting additional costs. That will mean more expensive canned sardines for the lowly Filipino.

It makes me wonder, in fact, why these canneries are not agitated enough to come out and make their collective voice heard.

But three groups dare to register their protest – two represent the consumers, and another represents the city’s barangay kagawads or councilors – who feel the sentiments of their constituents.

In a manifesto that came out in local and national papers this week, the Guiwan Consumer Group and the Zamboanga City ConsumerNET are jointly asking the Department of Energy (DOE) to resolve the power crisis in the city.

The manifesto says the people of Zamboanga have been suffering because of blackouts that have become longer and more frequent “ever since Crown Investment Holdings, Inc. (Crown) – the private sector entity that assumed the role of investment management contractor (IMC) of the  Zamboanga City Electric Cooperative (Zamcelco) –  decided to stop sourcing power from the Western Mindanao Power Corporation (WMPC) which was responsible for providing a huge bulk of the city’s power supply.”

In lieu of power from WMPC, the manifesto said, Crown has been deploying generator sets to sell electricity to Zamcelco.  Many of these generator sets are reportedly supplied by Desco, which is the technical partner of Crown when it was awarded the Investment Management Contract (IMC) last September. Could this be the real reason Crown and Desco are seemingly running around in circles on WMPC?

The worst part is yet to come since the cost of running those generator sets could eventually find its way into the monthly electric bills of Zamboangueños who will be paying extra for a solution that is viewed as inadequate.

According to the manifesto, those generator sets are not designed for continuous operation, and their use has resulted in daily voltage fluctuations and intermittent outages

These power outages that last two to three hours daily, the group laments, “do not only adversely affect daily lives of Zamboanguenos but have also been very detrimental to the economy of the city.”

The Federacion del Barangay Kawagad de Zamboanga (FEBARKAZA), citing information from media and the member consumers of Zamcelco, claims that the power outages were due to the stubburn “refusal” by Crown to pay WMPC its arrears amounting to P400 million for power already supplied to Zamcelco, and the “alleged complete disregard of the contract” entered into by Zamcelco with WMPC.

FEBARKAZA says the power outages in Zamboanga City are “artificial in nature because there are sufficient sources of power” in the area, and these blackouts have worsened since Crown terminated the management of Zamcelco, it was alleged.

The federation is seeking the immediate restoration of stable and reliable power to Zamboanga City and urges the board of directors of Zamcelco to cancel the Investment and Management Contract (IMC) awarded to Crown because of its reported  inefficiency in managing affairs of the electric cooperative

Speaking of the IMC awarding, it was reported that the manner of conducting the bidding was questionable from the start. For one, the Zamcelco board constituted itself into a bids and awards committee which can be in direct violation of National Electrification Administration (NEA) rules

For another, the deadline for the submission of bids was allegedly reset in  defiance of NEA’s directives, leaving Crown as the only bidder able to submit on time. Other companies with proven track records failed to make it.

Apart from trying to broker a meeting between the contending parties, NEA could use its mandate to compel Zamcelco to honor its obligations and seek legal remedies through proper channels. It should compel Crown to comply with its obligation under the IMC to uphold existing contracts of Zamcelco and ensure stable and uninterrupted supply to Zamboanga City.

WMPC, meanwhile, has filed for dispute resolution at the ERC which is hearing the case this week. The action of the ERC on this dispute should not only be swift, but should also take into account the legality of the issues under dispute and their impact on the long-suffering consumers of Zamcelco.

As for Crown, It will be best for Crown to review its decisions and do what is right – while time is still on their side.

In all these, I hope the Palace is tuned in.

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