'Phl power cost now highest in Asia'

MANILA, Philippines - The Philippines now holds the unenviable record of having the highest cost of electricity in Asia, beating Japan, Singapore and its more developed neighbors, House Deputy Speaker Lorenzo Tañada said yesterday.

“At P8.14 per kilowatt-hour, the price of electricity in the country is now the highest in Asia,” he said.

He said this price would soon go up once more, as if it is not already high and people could still absorb a new round of rate increase.

He revealed that the Power Sector Assets and Liabilities Management Corp. (PSALM) wants to pass on to the public P134.9 billion in loans and expenses it incurred from 2007 to 2010.

Tañada said the agency has already filed a power rate increase petition with the Energy Regulatory Commission (ERC), which will most likely act on it favorably.

It was Congress that created PSALM under the Electric Power Industry Reform Act (Epira) of 2001. The agency was tasked to privatize the National Power Corp. (Napocor) and use the proceeds from the sale of its assets to pay for its debt.

But PSALM itself is now mired in indebtedness, which it wants to pass on to the public.

“Epira was intended to be the solution to the country’s electricity problems, but PSALM now literally wallows in debt amounting to some $16 billion,” Tañada said.

What makes matters worse for the government and taxpayers is the fact that the agency continues to incur huge amounts of operating losses, he said.

He said expenses that PSALM wants the public to pay for through a power rate increase includes P1.16 billion paid to consultants in 2009 and bonuses to officers and employees equivalent to 5.5 months of basic salary.

He urged the House of Representatives and the Senate to jointly stop the impending increase and investigate both PSALM and ERC. He said the two chambers could do so through the Joint Congressional Power Commission, of which he is a member.

The commission is supposed to oversee the implementation of Epira, including the privatization of Napocor. It should share the blame for the high power rates in the country, according to some business groups.

Congress has just extended the life of the power oversight body and given it fresh funds.

It was Eastern Samar Rep. Ben Evardone who first blew the whistle on PSALM’s plan to pass on to the public hundreds of billions in loans and questionable expenses.

He called for an independent audit of how the agency used billions of dollars in earnings from the sale of Napocor power plants and other assets and billions more in loans it obtained.

He said the more than $10 billion in privatization proceeds that have been realized should have been enough to wipe out Napocor’s debt.