Energy chief welcomes creation of special committee by Meralco

Energy Secretary Vincent S. Perez has welcomed the initiative of the Manila Electric Co. (Meralco) to create a special committee to complement the group created by President Arroyo to resolve the controversy surrounding the power firm.

"It is good. That is a step in the right direction. There is no conflict whatsoever," Perez said.

The Meralco group is headed by former Prime Minister Cesar Virata, currently the president of the Bankers Association of the Philippines with the following as members: Washington Z. Sycip, Octavio Victor R. Espiritu, Christian S. Monsod, Monico V. Jacob and Emilio Vincens. Except for Vincens, the committee members are also directors of the Meralco board.

According to Perez, the creation of Meralco’s own committee will likely speed up the resolution of the issue.

"Now, I know who to talk to. I can now go directly to Cesar Virata and discuss directly with him," Perez said.

Meralco said the special committee, in its Dec. 6 board meeting, had already approved a shortlist of advisory banks and has identified a credit coordinator who will be tasked to oversee a viability plan for the utility firm.

Meralco said the selection of a financial advisor is consistent with the decision of the special committee which was mandated to pursue measures ensuring the firm’s long-term viability.

It also took into account financial forecasts covering different scenarios. The special committee emphasized that the interest of all Meralco stakeholders which include its customers, investors, suppliers and creditors, among others, will be carefully weighed and considered in formulating solutions to a number of challenging problems within the current regulatory environment.

Perez had also said that they have taken into consideration Meralco’s financial viability with regards to the participation of the utility firm in the Special Program to Enhance Electricity Demand (SPEED), a program aimed at giving discounts for large industrial users of electricity. The SPEED was supposed to be implemented in November this year.

In August, the National Power Corp. (Napocor) and Meralco launched the SPEED through the initiative and supervision of the Department of Energy (DOE) and the Department of Trade and Industry (DTI). It will provide a 92-centavo discount to big industrial and commercial users on incremental electricity consumption.

The scope of the SPEED program, which was originally intended for 656 large industrial and commercial customers in the Meralco franchise area covering Metro Manila and nearby provinces such as Bulacan, Rizal, Cavite and Batangas, was expanded to cover other distribution utilities’ franchises.