President Aquino bared yesterday a renewal energy program that sounds like a clone of the energy build up strategy of former President Fidel V. Ramos that resulted in a power glut and along with it came the cost of electricity in the country spiralling which has now become the world’s most expensive.
Aquino said his administration’s renewal energy program had lined up service contracts to fill the projected energy demand until 2030 of 15,500 megawatts (MW) or about $15 billion worth of contracts based on a thumb rule of $1 million per 1 megawatt on the cost of generating electricity.
Amid reports that Congress is mulling to grant him special emergency powers to address the Mindanao power crisis, Aquino said his administration’s energy plan seeks to cover power demands until 2030.
“It seems to be a clear path already to attaining the needed energy by 2030 even in the next, perhaps, three to four to five years. We will be ready when the demand comes in,” he told the Philippine Investment Forum yesterday at The Peninsula Manila.
With approved service contracts as of March totaling 7,067 MW under the country’s Renewable Energy Program (NREP) and with pending application for 3,771 MW more, Aquino said that these could add on to that current installed capacity of 5,000 MW that would be more than enough to address the whole 15,500 MW demand.
“Hopefully, the increased installed generation capacity will be the factor that would bring down the prices of electricity,” the President said.
Last June, the Department of Energy (DoE) announced that it aims to triple its clean-power capacity through the NREP. It aims to account for half of the country’s energy requirements by 2030, thereby
cutting the country’s dependence on puzzle-based and imported fuel.
His pronouncements came in the midst of widespread brownouts that have struck Mindanao that has apparently triggered a campaign in Congress to grant the President special emergency powers to address the situation.
But the Palace is maintaining a wait-and-see attitude on the proposed special emergency powers.
Deputy presidential spokesperson Abigail Valte said that they would have to study the proposal when it is filed at the Lower House.
“As of present time, the power situation is being addressed by the DoE with the stakeholders in Mindanao,” Valte said.
Congress, however, is not inclined on granting Aquino emergency powers anytime soon.
Bayan Muna Rep. Teddy Casiño yesterday said Aquino does not need emergency powers to address the Mindanao power crisis as suggested by some congressmen because this may serve to further aggravate the problem as what happened during the term of former President Fidel Ramos.
“All this knee jerk, Ramos-style emergency power palliative can do is to skip the requirements for public bidding and have the president make shortcuts in dealing directly with independent power producers (IPP). But Pres. Aquino can already invoke the Constitution in temporarily taking over power facilities like the two privatized power barges in Mindanao to immediately address the problem,” Casiño said.
“We must be very careful in giving presidents emergency powers because during the Ramos administration, the shortage was taken advantage of by private power firms in connivance with government officials to come up with onerous sweetheart contracts leading to high power rates that we continue to suffer till today,” the solon added.
Based on Article XII Section 17 of the Constitution, in times of national emergency, when the public interest so requires, the State may, during the emergency and under reasonable terms prescribed by it, temporarily take over or direct the operation of any privately-owned public utility or business affected with public interest.
Casiño called for the temporary takeover of two power barges owned by Therma Marine, Inc. which recently entered into an ancilliary power contract with the NGCP, resulting in the dramatic escalation of prices of generated power.
He said government should ensure that the two barges sell power at cheaper baseload prices instead of high ancilliary rates so that local power distributors can afford it, leading to the normalization of power supplies.
“The President should investigate Mindanao Development Authority (MinDA) chairperson Secretary Luwalhati Antonino’s accusation that the shortage is artificial and is caused by owners of the National Grid Corporation of the Philippines (NGCP) who want the Agus power plants privatized,” said Casiño.
“Aside from taking over the power barges, the administration should rehabilitate and expand the Agus hydropower plants, and immediately develop solar and other renewable energy as the long term solution,” he added.
“What we need now is more government intervention and not more privatization, this is the primary cause of the Mindanao power crisis in the first place and we should not fall in the same trap,” Casiño concluded.
Casiño is the author of House Bill 5405 or the proposed One Million Solar Roofs Act which provides for incentives and financing facilities to encourage the use of solar energy by ordinary electricity consumers like residences, offices and small to medium business establishments.
Meanwhile, Zambales Rep. Ma. Milagros “Mitos” Magsaysay said the government should not consider the proposed temporary reduction to Value Added Tax (VAT) on petroleum products as a short term solution to the problem but rather a sustainable marker to ease the plight of motorists and consumers nationwide in times of oil crisis.
“The government said it cannot do away with a two percent reduction in VAT on oil because the revenue from the tax fuels many government projects but if you look at the big picture, it is only a small portion of government revenues and collection,” Magsaysay said. “Programs will not cease to operate because of several months of reduced collections. But the impact will be felt immediately by consumers.”
The lawmaker explained that that VAT is an indirect tax which is passed on by businesses to their consumers directly and the reduction of VAT would result in a reduction of costs passed on to the end users. She said that if collection efforts are strengthened and tax evasion and smuggling are curbed, then the government will have more than sufficient taxes to fund their projects even with the temporary reduction of VAT.
“The thing is this temporary reduction is not going to be forever. It will return to normal once the prices of oil stabilize in the world market. Collection, will in turn, return to normal. If government experts will set the ceiling price of oil in order for the proposed measure to take effect and set the conditions when it will cease, then I see no problem with the set up. And each time oil prices fluctuate in the world market, we will have a basis to alleviate its impacts on the regular consumers,” said Magsaysay.
Sen. Aquilino Pimentel III is also calling on fellow Mindanao legislators to gather and act as one in coming up with solutions to the ongoing power crisis in Mindanao.
He said the power outages could also affect the delicate peace problem in Mindanao, where a long-running communist insurgency and a Muslim secessionist movement continue to create island-wide instability. Charlie V. Manalo, Rocky G. Nazareno, Daily Tribune
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