06 September 2011
– In a society where women are mostly in-charge of managing the household budget, higher electricity rates mean additional burdens and deeper indebtedness for Filipino women, especially those who already find it hard to make ends meet.
Members of the Freedom from Debt Coalition – Women’s Committee picketing the office of the Energy Regulatory Commission (ERC) in Ortigas Center, sent this message to oppose an impending new wave of electricity rate hikes.
The National Power Corporation (Napocor) and Power Sector Assets Liabilities Management (PSALM) filed petitions with the ERC for the recovery of stranded debts and contract costs amounting to almost P140 billion. This translates to 40 centavos per kilowatt-hour that, with ERC’s go-ahead, will be collected through the universal charge.
Judy Ann Chan-Miranda of the FDC Women’s Committee urged the regulatory body to junk the petition of Napocor and PSALM, stressing that it is “anti-women” and “anti-poor.”
“High power rates means women taking on even more work to pay for electricity and have something left for other essentials. It means cutting the budget for food, medicines and healthcare, the education of children. It means having little choice but borrow from loan sharks to avoid disconnection,” said Chan-Miranda.
FDC filed an intervention before the regulatory body last August 19, stressing the lack of merit and substance of Napocor and PSALM’s petitions.
The coalition warned that the proposed rate hike is part of a series of petitions lined up by Napocor and PSALM to fully source from consumers the payments for Napocor’s $17 billion or P729 billion (P42 = $1) debt.
In a previous statement, FDC said the petition on stranded debts tends to lump all types of Napocor losses to be paid for by electricity consumers through the universal charge (UC). “This opens the door for Napocor to charge consumers twice – through its regulated rates and through the UC.”
The coalition added that “the amounts sought in the latest applications do not have any relation to our legitimate usage of electricity because these are mainly financial obligations in the form of debts, borne of past government incompetence, mismanagement and corruption.”
FDC said that EPIRA’s formula of having government sell public assets, impose various additional charges and assume P200 billion of Napocor debt, has failed. “Consumers are being forced to shoulder this debt and unjustly penalized for the miserable that is the EPIRA.”
PSALM has proposed to collect a UC of P0.03 per kWh over 15 years for the stranded debt, and P0.36/kWh over four years for stranded contract costs.
Under EPIRA, a UC will be imposed on all electricity end-users to cover payment of NPC’s stranded debt and stranded contract costs. Stranded contract costs refer to the excess of the contracted cost of electricity under eligible contracts over the actual selling price of the contracted energy output of such contracts in the market. Stranded debts refer to any unpaid financial obligations of NPC which have not been liquidated by the proceeds from the sales and privatization of the firm’s assets.
Last year, PSALM had sought to recover P471-billion stranded debts recovery bid and three other applications which had been initially intended for pass-on to consumers under the UC component of the electric bills. Said petition was withdrawn and revised by the Aquino administration.
FDC had already urged PSALM to veer away from the past administration’s strategy of passing on the firm’s inefficiency to the consumers in terms of high electricity rate, and to confront head-on one of the roots of this problem – the onerous contracts with independent power producers (IPPs).
The group also urged the government to conduct a meaningful and substantial new round of review and renegotiations of contracts with IPPs, and immediately rescind onerous ones already established by the Inter-Agency Review Committee formed under the Arroyo administration.
FDC said the Committee’s 2002 report found five contracts “onerous” and 24 others “with various degrees of legal, financial, and social infirmities.” Only six of the 35 contracts came out “clean.”
FDC said that the debt of NPC will continue to grow and that electricity rates will continue to increase as long as the government continued to legitimize and honor these one-sided agreements. (30)