Privatize Napocor and Electric Rates Will Be Reasonable

PRESS STATEMENT

Cong. Teofisto “TG” Guingona III

2nd District, Bukidnon

May 5, 2008

Privatize Napocor and Electric Rates Will Be Reasonable

All of us, whether Administration or Opposition, want electric rates to go down. But do you know that generation charges make up sixty percent (60%) of our total electric bill? So, if we bring down our generation charge, we will bring down our total electric bill dramatically. The solution is in implementing the EPIRA law. EPIRA mandates that by 2009, seventy percent (70%) of NPC owned or controlled electric generating capacity should be privatized[1].

One of the purposes of EPIRA was to ensure affordability of supply of electric power[2], as well as transparent and reasonable rates, through a regime of free and fair competition[3]. Today, seven (7) years after EPIRA has become a law, NAPOCOR still owns or controls seventy percent (70%) of generating capacity. Prior to EPIRA, it owned or controlled ninety-five percent (95%) of generating capacity. This means that it took them seven (7) years to privatize twenty-five percent (25%). This is obviously too slow.

That is where the cause of high electric rates lies: monopolistic dominance of NAPOCOR of the generation of electricity. The evil of this monopolistic dominance is obvious.

Tingnan na lang natin yung nangyari sa WESM noong Agosto 2006[4]. Itong WESM ay isang palangke, pero sa halip na pagkain ang ibinibenta, kuryente ang ipinagbibili. Nahuli ng manager ng palengke ang NAPOCOR na nagbigay ng instruksyon sa kanyang mga planta na kailangang magkasabwatan sa pagtaas ng presyo ng kuryente. Parang pumunta ka sa palengke at gusto mong bumili ng galunggong. Sa palengkeng iyon, tatlo lang ang tinderang nagbebenta ng galunggong, si Neneng, si Selya, at si Doray. Wala nang iba. Pagdating mo sa palengke, napansin mo na napakataas ang kanilang presyo at pare-pareho. Yung pala, magkapatid sila at ang kanilang ama ay si NAPOCOR. Nadiktahan sila ng kanilang ama. Ganoon din po sa kuryente, nakakadikta ang NAPOCOR ng presyo ng kuryente sapagkat ito ang may-ari o kontrolado niya ang pitumpong porsiyento (70%) nito.

The solution to lower electricity rates is genuine competition amongst private generation companies in a regime of free and fair competition on a level playing field.

Privatize NAPOCOR and electricity rates will be reasonable.

[1] sec. 47-I, EPIRA

[2] sec. 2-b, EPIRA

[3] sec. 2-c, EPIRA

[4] Market Surveillance Committee Report, dated Nov. 20, 2006, addressed to the Board of the Philippine Electric Market.

13 Comments

  1. May 6, 2008 at 12:33 am

    Nobody wants electric rates increase. Frankly, nobody wants any increase in prices of our commodities. But I think that this issue needs to be discussed further to the public. It has to be open to the scrutiny of the Filipino people. We have to be aware that there is no hidden agenda in the privatization of Napocor. We are burned by the ZTE-NBN Deal already. We don’t want another scam. Opening this issue to the public and educating the Filipino people would solve our doubts.

  2. May 6, 2008 at 2:01 am

    The economy gets worse as time passes by. Despite the seemingly continuous rise of peso in the market, still it remains a question why prices of basic commodities and bills go up. We all know for a fact that the electricity bill is one thing that each family has to address every month and it does not help hearing that there are anomalies going on with regard to the rates that we have to pay. It’s unfair for those people who comply with their monthly dues. I mean, it’s not easy earning for that money and when we do worked really hard for it, we have all the right to demand what could reduce our load. Whatever move it is that could do well for the people, the government should aim for it. I think it’s just fair for those people who are in control to play the game the right way.

  3. May 6, 2008 at 5:51 am

    The write-up is indeed an expose. Things like this should be broadcasted to the public as often as possible for it really affects them and their way of living. The department involved ought to inform and explain to the public the things that are happening around them.

    The issue on the privatization of NAPOCOR became an issue for a number of years already, and until now there is no improvement. Slow development or no development at all?

    Electricity takes a big part on the budget of a typical Filipino family. And because of the continuous increase of its price, the money that should be allotted for the food and other prime commodities is now allocated to it. They couldn’t do anything. They have no power. Everything lies in the hands of those people who abuse their control over the society.

    And now, some concerned politicians are making ways to solve the problem, yet others hinder them because of their own personal intentions. As a result, we are now facing a very big problem, a serious one that could put Filipinos lives into a worse condition.

    People of the Philippines, dare to ask… be an inquirer! Be curious enough to find answers to the issues we have now from those who are involved in those stupidities.

  4. May 6, 2008 at 7:00 am

    I can seen that the aim (here) is to lower the price of electricity mainly through competition and destroying a seeming ‘monopoly’. In the end, how do we assure ourselves that the “private generation companies” won’t be reasons of concern in the future where these companies “gang-up” to raise electricity rates? I see vigilance as one, but what about measures that must be taken in terms of the legislative process?

    What about the situation where one “private generation company” raises its rates, prompting the others to follow, like what we see in oil companies today? Of course, oil companies are ‘dictated’ (as we are told) by the trend of prices in the global oil market. Then again, the point I want to raise is the parallel between oil companies triggering a domino effect in oil prices after one company raises its prices and so-called “power generation companies”?

  5. Dickson said,

    May 6, 2008 at 8:50 am

    Everyone seemingly suffers from such monopoly of NAPOCOR to our electric resources, especially those who hardly earn their meager income. Personally, I think NAPOCOR sometimes take advantage of the fact that they have no competitor in the line of service, hence their subscribers (which is literally all Filipinos) have no choice but to give in to whatever decision they would have in pricing our electric consumption. Having said that, If they would choose to increase electricity consumption price, we are left with no choice but to pay our unreasonable electric bills. If EPIRA would be the remedy for this scenario, I just hope it won’t end up like yet another big time issue like the NBN-ZTE deal.

  6. Oskie said,

    May 6, 2008 at 10:28 am

    One of the major culprits on our high cost of electricity, which is second only to Japan if I am not mistaken, is the Independent Power Producers or IPPs. It was during FVR’s time where most of these IPP’s where established. FVR really put our country in bad shape!!! Because of his IPP projects, it is the Filipino people who are now suffering.

  7. ricelander said,

    May 7, 2008 at 3:19 am

    So what’s the problem that NAPOCOR could not be privatized with speed?

  8. jts said,

    May 8, 2008 at 11:28 pm

    bawat pangulo na nagkaron tayo ay may mga naitulong din sa mamamayan kahit papano pero mas di hamak na sandamakmak na paghihirap at sama ng loob ang naidulot nila sa karamihan ng mamamayang pilipino. resolbahin na ang energy-related problems na yan at wag kalimutan ang ZTE Scandal dahil pasanin natin yan

  9. Migs Bennett said,

    May 14, 2008 at 5:21 pm

    Other than the privatization of NAPOCOR or working on whatever Meralco has to take from you, the government with the seemingly inept ERC and the equally inept Dept. of Energy, should have been working on finding alternative sources of energy other than geothermals, hydro power and compressed gas.

    A few years ago we presented solar and wind power technologies to the government and instead of giving us an opportunity we were instead shown the way out while those goons from the major oil companies looked rather pleased that we were not paid any mind.

    After licking our wounds, we decided to share the technology. And I would gladly share it with you or anyone who willingly requests for it: I have manuals and schematics on how to build your own small scale, personal, home wind turbines. I have 2 wind turbines powering my home in Benguet and i am 100% free of fossil fuel use and I don’t have to worry about my electric bill. These turbines are so small they can be attached to the side of your house while generating enough power to run your ref, lights and electric fans.

    Para sa bayan! I would be glad to share the technology with you as long as you share it with many others. Let’s face it, the price of gasoline is not going to get cheaper – only more expensive. There is talk it could hit the $200/barrel by December. But certainly will cost more in 10 years.

    It is time we start looking for and or working on alternative sources of energy. Wind and Solar are two best options. Do it now before it’s too late.

  10. Raine Subijano said,

    May 18, 2008 at 3:48 pm

    Sir, i would just like to know if the Market Surveillance Committee Report, dated Nov. 20, 2006, addressed to the Board of the Philippine Electric Market (as you cited in your article) is available for viewing? If yes, can you help me sir on where can i access the copy? It would be such a great help for us students. Thank you, sir!

  11. johnelyn kim said,

    May 28, 2008 at 11:03 am

    privatize?

    pero hndi ba mas lalong tataas ang presyo ng kuryente dahil sa wala ng kontrol dito ang pamahalaan?

    things could get even worst..

    siguro kaya gnun.. nagtatakipan dn ang mga politiko kung cno ang may sala.. hahaha..

    at kapag pribatisado na ito..

    well, ganun pa dn., pagtatakpan pa dn cla ng pamahalaan

  12. Mindanaoan said,

    February 7, 2009 at 6:37 am

    any updates?

  13. Ace said,

    March 5, 2009 at 2:48 pm

    Hi Migs Bennett! I hope my message would reach you. Your URL seems to be inactive. it says ‘page cannot be displayed”. I’m interested of what you’re discussing..about wind turibine – making. I would appreciate much if you could share with me your copy of the simple wind turbine for small homes. Thanks-Ace


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