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Power Watch decries electricity rate hike

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One of the reasons in our recent electricity rate increase was the high generation rates due to price hike in the Wholesale Electricity Spot Market (WESM) in April, brought about by “power supply concerns” which is a euphemism for yellow or red alert, Power Watch Negros secretary general Wennie Sancho said in a press statement.

A red alert is raised when there is insufficient power supply in the grid to the point where power interruptions must be resorted to, he said.

Sancho expressed his disgust on the generation charges to be shouldered by the consumers, who are reeling from inflation and high cost of living. One of the factors that led the NGCP to declare a yellow or red alert was because of the unreliability of several generation plants to go on planned and unplanned outages.

The consumers have nothing to do with the power outages. Why penalize them by making them pay for the failure of the power generators? The cause of the cost should pay the cost, not the consumers. It is an added form of injustice to the consumers who are suffering from the inconvenience brought about by blackouts, insufficient ancillary services, ineffective system operations, under capacity, and power plant shutdowns, he said.

ERC and DOE should assess the feasibility of retiring these unreliable and obsolete power generation plants that have been experiencing recurring outages on an annual basis. It would seem to appear that the planned and unplanned outages of most power generation plants are happening in concert. We hope these were not deliberate actions, Sancho added.

Without an accountability mechanism in place, generation companies do not have the incentive to improve their services by maintaining their power plants in good condition, training and hiring experts that can respond quickly to unplanned outages, purchasing spare parts and equipments needed for breakdowns, and immediately having their generation plants up and coming, he said.

Owners of the generation plants are ecstatic on their material success as they reported their profit in billions of pesos at the expense of the consumers. The frustration of the consumers is exacerbated when the power generators announced to all and sundry their high profit margin, courtesy of WESM and company. WESM is the most expensive electricity trading center in the Philippines, Sancho said.

The discrepancy between the opulent lives of the power plant owners and the economic starvation experienced by the consumers daily, calls for a closer examination with regards to the affordability of electric power to the poor. It is an added form of injustice against the electricity consumers because this generation rate increase will cause the deterioration of their purchasing power. For the workers it will reduce their minimum wage into starvation wages. Isn’t it an injustice when the poor become poorer and the rich become richer? He asked.

Sancho said government regulatory agencies like ERC, DOE and NGCP must ensure the balance between companies profitability and consumers welfare. Power generating companies should bear greater accountability and responsibility in justifying their profit and their commitment to advance the welfare of the consumers.

Erring power producers should be penalized with appropriate fines, even including revocation of their certificate for compliance and/or endorsement for their gross incompetence in failing to provide crucial service in the midst of power crisis, Sancho said.

Power Watch Negros is calling for a collaborative effort to work together in tackling this issue by promoting fairness, accountability and transparency in the energy sector, he added.*

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