Meralco lays out wish list for next PH president

MANILA, Philippines — Allowing the Manila Electric Company (Meralco) and other private firms to invest in more power plants and other critical infrastructure is on the top of the firm’s wish list for the country’s next president.

Meralco Chairman Manuel V. Pangilinan said in an earlier interview that his firm hopes the next administration would allow the private sector to invest in critical infrastructure, to help boost economic growth.

The Pangilinan-led group and other conglomerates such as San Miguel Corporation and the SM group have experienced delays in the current administration’s approval or project implementation processes.

The 6-year term of President Benigno Aquino III ends soon, with only a few months left before the national elections in May.

“To be fair, there are no schools for presidents. Quite likely, new presidents are new presidents and they haven’t been there before, unlike prime ministers,” Pangilinan replied, when asked for his aspirations for the country under a new presidency.

“We always batted for more power plants because we create pricing pressure,” Pangilinan said.

Meralco, the country’s largest distribution utility (DU) firm, is also involved in the power generation business via Meralco PowerGen Corporation (MGen). Together with partners, MGen is gearing up to achieve a target of providing 3,000 megawatts (MWs) of power generating capacity in Luzon.

He said it is better for the Philippines to have “more supply than less.”

“If the power plants are new then they are more efficient and better for the country. You could then retire old, creaky, expensive coal-fired plants. We should do just that,” he said.

Allow the private sector to invest. It’s their money, it’s their risk. There’s no government funding involved, there’s no guarantees involved. So let them, subject of course to environmental constraint and proper permitting,” Pangilinan added.

For instance, MGen-led consortium’s 600-MW power plant has been delayed since 2010 due to legal hurdles.

‘Electricity similar to other critical infra’

Pangilinan stressed the importance of power-related infrastructure in the country. He said, “Electricity is similar to water, toll roads and other critical infrastructure which are vital to everybody’s welfare.”

For his part, Meralco President Oscar Reyes said industry stakeholders should support one another to achieve an adequate supply of generation capacity, an interconnected transmission system, and a reliable distribution network.

“The whole industry must work together. Generation, transmission, and distribution must work together under the oversight of the leaders of the ERC (Energy Regulatory  Commission) and DOE (Department of Energy),” Reyes said.

Pangilinan said it is difficult to enumerate the important policies that government must give focus on, adding “it is a broad range.”

Nonetheless, DOE Secretary Zenaida Monsada said that the policies crafted by the agency are meant to ensure a level playing field among industry stakeholders. 

“It has been the goal of the DOE to create a healthy environment, to foster competition that will benefit the consumers. We are also looking after the welfare of the consumers,” she said, when sought for comment.

ERC Chairman Jose Vicente Salazar, meanwhile, said the agency has “detached itself from politics” to arrive at a reasonable decision with an end view of looking out for the consumer’s welfare.

“The law has made us independent. We have laid down the necessary resolutions. We have insulated ourselves from politics. Rest assured that we will decide on the cases fairly,” Salazar said in a text message.

Reyes stressed the importance of a harmonized power generation, transmission and distribution network. 

“You have to look at the whole industry. We must try to provide that much support to the generation sector, particularly in terms of addressing shall we say what is the most critical. Number one is transmission,” Reyes said.

The transmission facilities are important to the power sector. Without these, the power produced by the generation firms could not be transported to the DUs which, in turn, are responsible for distributing power to end-consumers.

The National Grid Corporation of the Philippines (NGCP) operates the country’s transmission network. 

Recently, the grid operator has been reporting of right-of-way (ROW)  violations that  have resulted in interrupted transmission services.

“ROW violations, along with bombing attacks, have become the significant problems for NGCP.  It will be very difficult for us to deliver the available power supply to distribution utilities if we continue to encounter these problems,” NGCP said when sought for comment.

NGCP legally holds the ROW in the areas near and around the transmission towers and posts.  The assets, however, are still government-owned.

A coal power project in Subic by a consortium headed by MGen has encountered ROW problems that led to a delay in the project’s timeline.

But the delays and other problems encountered by Meralco do not hinder the utility firm from further investing in the country. “These problems are all part of a fulfilling life. That’s why it’s more fun,” Pangilinan said. – Rappler.com