Arroyo may use emergency powers to solve Mindanao energy crisis

President Gloria Macapagal-Arroyo may likely adopt a recommendation from the energy department to use emergency powers for the looming energy crisis in Mindanao, a Malacañang official said. The power situation in Mindanao has worsened, with brownouts lasting for up to eight hours, deputy presidential spokesman Gary Olivar said, citing reports. “Dahil lumalala ang problema di ako magtataka kung matuloy yan, pero nasa pangulo pa po," Olivar said in an interview on dwIZ radio. (Since the problem is worsening, I will not be surprised if she does take on emergency powers. But the decision is still up to the President.) Earlier, Energy Secretary Angelo Reyes asked Mrs. Arroyo to declare a power crisis in Mindanao, in connection with the worsening power shortage there. Reyes was quoted as saying that the recommendation was agreed upon in a meeting with Energy officials, local government units, and businessmen in Mindanao. Mindanao has been experiencing rotating brownouts for days, with some lasting for eight hours. Declaring a power crisis is the first step needed to secure an exemption from the privatization of the power generation business mandated by the Electric Power Industry Restructuring Act of 2001. “Upon the determination by the President of the Philippines of an imminent shortage of the supply of electricity, Congress may authorize, through a joint resolution, the establishment of additional generating capacity under such terms and conditions as it may approve," Section 71 of Epira provides. As a result, companies that propose to build power plants may be exempted from public bidding and negotiated deals, a source familiar with the matter told GMANews.TV. About 56 percent of Mindanao’s power is sourced from hydroelectric power plants. Data from the National Grid Corp. of the Philippines showed that on Sunday, available capacity in Mindanao was 798 megawatts against peak demand of 1,100 MW or a deficit of 302 MW. Distribution utilities were implementing rotating brownouts of up to seven hours. Rotating brownouts lasting for an hour were imposed in Davao City; two hours in Iligan City; four to five-hour in Cagayan de Oro and General Santos City; and seven hours in Zamboanga City. Last Saturday, Mati in Davao Oriental had no power for 24 hours. Emergency powers to lead to anomalous contracts, group says In the meantime, a leftist group opposed giving emergency powers to the President, saying that it is “no guarantee that policy-borne problems in the power industry can be addressed," Partido ng Manggagawa (PM) Chair Renato Magtubo said. The same emergency powers were given to ex-president Fidel Ramos when an energy crisis engulfed the nation in the late eighties to the early nineties. “And while that emergency power enabled Ramos to add new capacities in the system, the consequence of high power rates due to anomalous contracts with private independent power producers (IPPs) bound the people into paying high PPA [power purchase agreements] charges," explained Magtubo. Under the PPA, consumers were forced to pay for unused electricity. Magtubo, who led the expose on the payola scandal attending the passage of the Omnibus Power Bill in the House in 2000, pointed out that when the country had enough supply of contracted power – or more than half of what the Philippines needed at that time – officials embarked on reforming the power industry through the Electric Power Reform Act of 2001 or EPIRA, supposedly to ensure reliability and affordability of power supply. The party-list group insists that the problem that the country faces now is undoubtedly policy-related hence it is pushing for the reversal of privatization and deregulation of policies in the power industry. - Carmela Lapeña, RJAB Jr., GMANews.TV