18 November 2008
- With the smooth passage in the Senate yesterday of a bill granting a national franchise to the National Grid Power Corporation (NGPC) to operate the National Transmission Corporation (Transco), the Freedom from Debt Coalition said it is deeply saddened that the battle to protect the country’s ‘crown jewel’ is lost as Transco is finally under private control now.
“Surrendering control of the national grid was the government’s biggest lost and blunder in pushing for the privatization of the power industry,” stressed the group that consistently fought for national control of the national grid.
FDC stood firm on its position that since transmission is a natural monopoly and considered the backbone of the industry, the state should remain in control of it. It also considered Transco as the nation’s “last line of defense” in the power industry against the onslaught of privatization.
“Because transmission is a natural monopoly, whoever gets hold of it is bestowed with monopoly power. And monopoly in business means not only economic power but also political power,” said FDC in a statement.
That political power, the group lamented, clearly manifested in the way how the bidding process was captured and the franchise law was conceded through a powerful lobby and political connections.
In the House of Representatives, the franchise bill was approved in stealth manner. In the Senate, only four senators voted against it, raising speculations that the main proponent of the bill, Senator Juan Ponce Enrile, may have gained the reward following his take-over of the Senate.
“The people could have lost the ‘crown’, but somebody may have gained the ‘throne’ out of it,” said the group.
In a controversial auction held in December 2007, PSALM awarded the contract to a consortium led by the State Grid Corp. of China, Monte Oro Grid Resources Corporation (MOGRC) and Calaca High Power for a bid price of $3.95 billion. The consortium was later named the National Grid Power Corporation. Monte Oro is closely identified with businessman Ricky Razon, a close ally of the First Family, and Buboy Macapagal, the president’s brother. Transco’s average annual income is around P16 billion.
Now that the power privatization is almost completed, the FDC said, this is not yet the end of the battle since the failures of this privatization program itself creates the imperative for reversing it. Thus, the group is now embarking on formulating alternatives to the current setup. -30-