Tañada: Privatization of Agus-Pulangi “not yet inevitable”

Rep. Tanada/Bukidnon News photo

VALENCIA CITY – (Bukidnon News Dispatch/09 Sept) The feared
privatization of the Agus and Pulangi power complexes may still be
averted, Deputy House Speaker Lorenzo Tañada III said here Friday.

Tañada said there is a chance that the Joint Congressional Power
Commission (JCPC) will recommend to amend the Electric Power Industry
Reform Act, which provides privatization of the two power complexes,
10 years after it was passed.

There is no certainty yet, he said, that Congress will allow the
privatization. Tañada admitted that he has advocated against
privatization as it is not the solution to the projected power crisis.But Tañada, who sits in the joint body, cited two scenarios possible
if in case Congress decides for privatization.

He said there must be preference for the electric cooperatives to run
the power complexes, with combined installed capacity of 982
megawatts, so that the stakeholders may still have control.

The representative from Quezon province’s 4th district said he
supports the Bukidnon Power Commission’s plan to buy the Pulangi IV
hydro electric power complex.

Tañada said another scenario is to privatize only the additional
capacity for power generation. He said the main combined capacity of
the power complexes must remain with the government.

Tañada was in town to grace the launching of the Valencia City 2011
Historical Photos and Cultural Exhibit, an initiative of the Valencia
Bukidnon Historical and Cultural Society. The group pushed for the
creation of a city museum.

Last month, the Bukidnon Power Commission, created by Gov. Alex
Calingasan earlier, filed a resolution endorsing the privatization of
the Pulangi IV power complex and for Bukidnon stakeholders, through
the local electric cooperatives to acquire it “so that the power
crisis will be averted.”

On September 7, the Sangguniang Panlalawigan, after hearing
representatives from the First Bukidnon Electric Cooperative and the
Bukidnon Second Electric Cooperative explain about the proposed
acquisition, expressed support for the plan “in principle.”

The provincial board wanted to know the details of the plan, sources
of funds among others. They did not file a resolution pending the
presentation of feasibility studies for the plan.

At the joint Philippine Economic Briefing and Regional Development
Council meeting in Cagayan de Oro City on March 23, President Aquino
warned Mindanao residents that they may be paying higher electricity
rates beginning next year, when the exemption from privatization of
the Mindanao power plants of the National Power Corporation ends. He
said the Electric Power Industry Reform Act (EPIRA) exempts Mindanao
NPC plants from privatization, and that this has led to a situation
where the government subsidized power rates in Mindanao.

“This produced a situation where we kept on selling electricity at
about P3 when the actual charge of generation was P5. That, of course,
is contributory to debt that is inherited by PSALM and the number is
daunting. It is P1 trillion,” he said.

Section 47d of RA 9136 or the EPIRA provides that the Agus and the
Pulangui complexes in Mindanao shall be excluded from among the
generation companies that will be initially privatized.

“Their ownership shall be transferred to the PSALM Corp. and both
shall continue to be operated by the NPC. Said complexes may be
privatized not earlier than ten (10) years from the effectivity of
this Act, and except for Agus III, shall not be subject to
Build-Operate-Transfer (B-O-T), Build-Rehabilitate-OperateTransfer(B-R-O-T) and other variations thereof pursuant to Republic Act No.6957, as amended by Republic Act No. 7718. The privatization of Agus and Pulangui complexes shall be left to the discretion of PSALM Corp.in consultation with Congress,” the EPIRA provides. The EPIRA waspassed in 2001. (Walter I. Balane)

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