Collector

Now we are seeing what economists call the “second round effects” of the spike in oil prices. Electricity prices rose sharply this billing period.

Consumers are up in arms. Higher power demand during these hot months twinned with costlier generation costs. For many, the electricity bill is intolerable.

Meralco bears the brunt of consumer outcry. This is because the power distributor collects for everyone else: the power plants, the grid and government taxmen. Although the entire power industry is complex, Meralco is the company that faces the final consumer.

To clarify the actual distribution of the costs adding up to the final bill, energy authorities asked Meralco to fully itemize the component costs. The distribution utility’s share of the final bill is actually miniscule.

In the face of consumer outcry, Meralco found it necessary to mount a massive public information campaign. This is led by the tireless Joe Zaldarriaga, the company spokesman.

Using the company’s own resources, Meralco tries to build public understanding of the energy sector. It is a complex industry, but Joe somehow manages to explain things in plain language.

The more consumers understand the many components of the final bill and Meralco’s role as collector for multiple billers, the more questions are now raised about many components of the final bill.

It is easy enough to understand that higher fuel costs inevitably translate into higher power costs. But the final electricity bill is more than just generation and distribution costs. Incorporated in that bill are a lot of other charges mandated by law.

For instance, the final bill includes charges for various socialized pricing mechanisms intended to lighten the load of indigent households and senior citizens. Also included are costs for energizing remote communities – something that could be covered by regular government appropriation.

In effect, some electricity consumers pay for cross subsidies to offset consumption by poorer sectors. While the components of the final bill are indeed itemized, many of these component costs are not truly transparent. This is because, instead of transparent taxation and government appropriation, the costs of providing more affordable electricity for the poor are passed on to other consumers through layered charges. The layered charges are not evident in the bill itself.

What we have is a complicated charging system where the middle class and businesses pay more to offset power prices for the poor.

While social justice goals are valid, there may be some debate whether such a complex system of cross-subsidies is efficient for the economy in the long run. This charging system could help explain why our middle class remains both small and precarious – and why our businesses are uncompetitive.

This time of crisis might be a good time to rethink the system in place.

Focal point

Ombudsman Jesus Crispin “Boying” Remulla has become the focal point of public interest – and political speculation – the past few days.

The ombudsman earlier announced plunder charges will be filed against former speaker Martin Romualdez and former Senate president Francis Escudero. This was followed by precautionary hold departure orders, the freezing of dozens of bank accounts and the possibility of finally seeing the “big fish” in jail.

All these could, of course, be the result of Remulla simply doing his job – with resoluteness and tenacity. But there are enough people unwilling to leave it at that. They imagine a well-constructed political play in progress.

Some lawyers point to what they call the “Boying fallacy.” When he was justice secretary, Remulla pushed for a higher standard of proof before charges are brought to court. Instead of mere possibility of guilt, he raised the standard to some certainty of conviction. This is intended to help declog our courts of cases.

But in going after the former speaker and the former Senate president, Remulla appears to be basing possible plunder charges on the official roles they performed in crafting the controversial 2025 national budget. But it is possible, of course, that Remulla may have built up a more solid case than he lets on.

What makes people wary of a crafty political play underpinning the ombudsman’s course of action is Remulla’s potential to play the role of king-maker in the coming elections. Boying, after all, is both a competent lawyer as well as a well-reared political player. His brother, the current interior secretary, is generally considered presidential material. The Remulla family’s political dynasty was built on shifting alliances at critical moments in our political history.

Should the ombudsman proceed with its announced intention of filing plunder charges against Romualdez and Escudero, this will cause a political earthquake of sorts. Romualdez recently emerged from the shadows to denounce what he considers a plot to throw him under the bus, to blame him for the massive corruption unveiled last year.

Boying is no political novice. He knows that bringing charges on the former speaker could eventually drag his cousin, the President, into the corruption mess. Disturb the waters, expect a storm.

Last week, President Marcos mistakenly announced the capture of fugitive Zaldy Co in the Czech Republic. It turns out, Co was merely questioned for improper travel documents and subsequently released. He is now reportedly seeking asylum in France.

Things might have been very different if Co was indeed arrested and repatriated. This would have rekindled interest in the scandal and induced unexpected testimonies.