Enrile: Lower power rate bills being held back

CEBU, Philippines - If Senate President Juan Ponce Enrile is to be believed, powerful interest groups are still pushing the House of Representatives to delay the passage of the legislation he has put forward to bring down the cost of electricity in the country.

Enrile, who is seeking another term under the Partido ng Masang Pilipino, filed last year the proposed bills to slash power rates to benefit industries, commercial establishments and individual consumers, but none of the proposals were approved by the end of the congressional sessions last February 3.

This developed as power system operator National Grid Corporation of the Philippines has announced that the nationwide electricity grid will continue to have lean contingency reserves.

NGCP, in a press statement said that electricity supply generated from power plants continues to be low and may not be enough to meet the demand of all power grid users.

NGCP added that maintenance shutdowns are conducted to make way for preventive maintenance works or repairs which will improve power facilities and services.

Aside from the shutdown of the 14 power plants (four in the Visayas, eight in Luzon and two in Mindanao) , the onset of the El Niño dry spell has also limited the available capacity of most hydro-power plants.

As the system operator, NGCP’s main responsibilities are to transmit high-voltage power from generators to distributors and to operate the power system in accordance with the Philippine Grid Code.

NGCP explained that it does not own nor operate and maintain any power generation and distribution facilities.

"As a result of the very thin reserves, the system may be forced to implement load curtailment among grid users to ration the available power and to ensure the reliability and stability of the entire transmission network. Customers are advised to coordinate with distribution utilities in their area for the schedule of power interruptions, if there are any," the statement added.

Enrile filed Senate Bill 3147 or the Uniform Franchise Tax Act, and Senate Bill 3148 or the Electricity Rate Reduction Act – twin measures envisioned to give immediate relief to power consumers. The proposals are also designed to amend the Electric Power Industry Reform Act passed in 2001.

Enrile said one amendment he is seeking is the lifting of the Value Added Tax on distribution, power generation and transmission, which is subsequently passed on to consumers by distribution companies, including Meralco and electric cooperatives all over the country, even if consumers do not consume a single watt of electricity.

SB No. 3147 proposes to impose a uniform franchise tax of three percent on distribution utilities and eliminate layers of tax.

Enrile added that reverting to the old system is more "manageable" and "fair" and in line with the principle that "public utilities ought not and must not be used as sources of public revenue as these public utilities render public services to the taxpayers".

"Power rates would have been reduced by 23 centavos per kwh for household consumers and five centavos to 12 centavos per kwh for business establishments had the lower house passed the twin proposals," Enrile said in a separate statement sent to The FREEMAN. -Mitchelle L. Palaubsanon/BRP   (FREEMAN NEWS)