Posted on January 26, 2015 11:50:00 PM
By Claire-Ann M. C. Feliciano, Senior Reporter
THE SENATE will miss its original self-imposed deadline for a joint legislative resolution that will give the Executive options to avert a power crisis looming in Luzon, according to a leader of that chamber yesterday, but for officials of the House of Representatives and foreign business groups a last-minute measure would still be better than none at all.
Noting that Congress lost three days of work during the visit of Pope Francis last Jan. 15-19, Mr. Osmeña said the draft his committee will eventually approve for plenary consideration is still with a technical working group (TWG).
“We have been putting pressure on the many parties involved to agree on the closing details,” Mr. Osmeña said.
“I will not give a due date, but the committee report should be filed within two weeks.”
He sought to assuage fears any delay would derail efforts to avert the crisis in Luzon — which contributes about 70% to national output — saying such preparations have been under way without the resolution, which will lay down procedures that will strengthen options already available to the government.
“The deadline is not necessary because the specific powers being considered will not be needed until March,” Mr. Osmeña said, even as the Energy department will have 30 days from enactment to issue implementing rules and regulations.
Saying “[t]here is nothing that the lack of a resolution can delay,” Mr. Osmeña emphasized: “Again, there is no power that the Executive does not already enjoy today to pursue preparations for the summer shortage.”
An official of the House of Representatives and leaders of two foreign business groups said the supply concern will be addressed as long as the joint resolution is enacted before the critical period that will run from March to July.
President Benigno S.C. Aquino III invoked the power crisis provision of Republic Act No. 9136, or the Electric Power Industry Reform Act of 2001, in September last year after the Energy department announced a looming power shortage in Luzon, with latest estimates showing the need for additional 782 megawatts (MW).
While the joint resolution was originally anticipated as a measure to allow government to contract additional capacity to bridge the shortfall, the country’s chief executive admitted that time has run out on this option, which requires six months of preparation.
Central to the joint resolution is the Interruptible Load Program (ILP), an existing scheme under which businesses with power generators will run these facilities to lessen demand on the grid.
A check with the Web site of the National Grid Corporation of the Philippines bared thin reserves nationwide: 737 MW in Luzon, which requires at least 1,000 MW; 160 MW in the Visayas; as well as a 103-MW deficiency in hydro-dependent Mindanao.
The resolution approved by the House last month:
• authorizes the government to reimburse businesses’ cost of running their generators;
• exempts such payments from income tax;
• allows the government to force businesses that will not seek ILP accreditation to run such facilities whenever deemed necessary, but without reimbursement;
• calls for reinvigorated energy efficiency and conservation efforts by government and private sectors; and
• pushes fast-tracking of committed power projects.
While Mr. Osmeña noted that ILP accreditation has been under way, he hinted at bumps in TWG discussions.
“Agencies concerned have been having problems deciding who will orchestrate the billing and refund for the directly connected companies,” he explained.
“The devil is the details.”
Latest available data from the Energy department showed capacities committed under the ILP totaled 727.4 MW as of Jan. 20.
Mr. Osmeña’s counterpart in the House emphasized the importance of the measure. “If we don’t issue the joint resolution, the government’s efforts will get wasted,” Oriental Mindoro Rep. Reynaldo V. Umali (2nd district) said in a telephone interview yesterday.
He said absence of the measure will make the ILP less effective.
“It will make ILP strictly voluntary and there might be concerns on lack of capability to compensate the participants,” Mr. Umali said.
“The Energy Regulatory Commission might be forced to pass on to consumers additional costs.”
Foreign business leaders, while citing the need for the joint resolution, said there is the additional worry of contingencies that authors of the measure could not foresee.
John D. Forbes, senior adviser of the American Chamber of Commerce in the Philippines, cited the envisioned measure’s provisions on energy conservation and efficiency.
“There’s not enough attention being paid to the demand-side management, especially on improving efficiency and power conservation,” he said in a text message. “Hopefully, the Congress in this resolution could give a push to such policies.”
At the same time, Mr. Forbes flagged the possibility of unforeseen contingencies. “There are too many unpredictable situations in power generation,” Mr. Forbes said, citing intensity of heat in the dry months, unscheduled shutdown of power plants and port congestion that may delay delivery of critical plant components.
“Businesses will continue to worry until we see sufficient new base load and peaking power plants that are operating,” he said.
European Chamber of Commerce in the Philippines Executive Vice-President Henry J. Schumacher, for his part, said: “The advantage of the joint resolution is that ILP and investment in energy efficiency and energy conservation will move from purely voluntary to closer to compulsory.”
“It underlines the basic approach, which is to stop complaining and become part of the solution.”
Mr. Schumacher shared Mr. Forbes’ concern that, even with the joint resolution, “we still have to deal with unscheduled shutdowns of power plants due to old age or sufficient maintenance.”
Even as he admitted approval of the joint resolution was taking more time than his group had hoped, Gregorio S. Navarro, president of the Management Association of the Philippines, was more optimistic, saying separately via text there should be no more worries “if we get enough MW to sign up with the ILP.” — with Imee Charlee C. Delavin and Melissa Luz T. Lopez
Comment here