“Energy prices, fuel and electricity, are significant economic drivers”
In his first State of the Nation Address or SONA, President Ferdinand R. Marcos Jr presented his economic agenda. In my appreciation and expectation of the historic vote mandate are the “hows” in fulfilling the campaign slogan “Sama-samang Babangon Muli.”
I would like to focus on the word “sama-samang” of the slogan. It simply implies that on our path to economic recovery, everyone shares the solutions and responsibilities.
In doing so, it’s my hope that everyone will also have their share of the fruits of our collective and participative efforts and sacrifices.
Sacrifices. Now that’s a key element in everyone’s share of carrying the burden. Most of our kababayans (fellow Filipinos) who are less fortunate have no other recourse but to further harden their weary shoulders because they have no other choice but to do so.
Now, let me put this in the context of our energy sector.
Energy prices, fuel and electricity, are significant economic drivers. There is not much talk about the ongoing appeal to the Energy Regulatory Commission by a distribution unit and two generation companies (GenCos) for a temporary relief from their “commitments,” one of which is the fixed-price clause, in their Power Supply Agreement contracts. The appeal aims to charge P5.2B to the DU’s captive customers.
I chanced upon a news article quoting Senator Sherwin Gatchalian: “You made the commitment for the fixed price, so you (GenCos) should stand by that commitment.”
Recently, news came out about the DU’s warning of rotational brownouts if their joint appeals are not granted.
I couldn’t agree more with Senator Gatchalian in his statement in relation to this “appea.” According to him, “If the actual price of fuel, for example, coal, is lower than the fixed price, the GenCos will enjoy the difference between the fixed price and the actual price. But if the price of fuel goes up, the Gencos take that risk.
They will absorb (costs). Pagalingan na lang sila in terms of hedging.”
I don’t know how the ERC will take the warning from the DU. But if I’m part of that commission, and as a consumer myself, I think of it as pure blackmail in broad daylight.
It’s practically gaslighting, and putting the blame on the ERC, making them the culprits for the threat of brownouts if the commission does not approve the price increase.
Furthermore, when Malampaya stopped natural gas fuel supply to one of these GenCos last month, wasn’t the GenCos able to source sufficient replacement power from the market?
Is this threat of supply shortage and widespread blackouts for real? Or is the DU simply sowing fear, to pressure the ERC to grant their request? Blackmail.
Going back to our President’s campaign slogan, “Sama-samang Babangon Muli,” it seems like the appealing DU and GenCos are not willing to participate in carrying out their share of sacrifices.
It seems like the DU and GenCos are the ones that have sama-samang nag-blackmail ng milyun-milyong captive customers to pay for their deficiencies, or else face the consequence of (supposed) widespread blackouts.
They’d rather pass on their loads to those who are already heavily burdened and with far lesser means for coping with the challenges.
I cannot help but wonder about the two other GenCos that were awarded power supply agreement contracts in 2019 by the same DU, yet similar appeals for temporary relief are unheard of; not even a hint of intent.
All GenCos confidently submitted their bids. All have the same economic factors to deal with.
Well, the appeal and “blackmail” simply show who upholds integrity and commitment.
(Richard Orsino is a retired executive who worked for three decades in the telecommunications industry.)