Osmeña: Aquino, Petilla ‘awful managers’
MANILA, Philippines – Senator Sergio “Serge” Osmeña III told President Benigno Aquino III to fire Energy Secretary Jericho Petilla, saying he is responsible for the energy shortage. (READ: Osmeña: Petilla should resign over Meralco rate hike)
Osmeña said he gave Aquino the advice two months ago because Petilla's attention is "divided" and he is more focused on politics than the power sector.
“I’m not satisfied with his performance that’s why this happened,” the senator said referring to the Manila Electric Company (Merlaco) power rate hike in December, the biggest price hike in recent history. Consumer groups and leftist lawmakers questioned the legality of the rate hike before the Supreme Court.
The senator said he set a meeting with Aquino to discuss the matter but “Inindyan ako.” (He stood me up.)
Osmeña said of Petilla, “He’s a very intelligent, well-trained fellow but his focus is on politics.”
The senator said Aquino did not heed his advice about the former Leyte governor.
“That’s the way he solves things. He stays with people he appointed. He’s a very poor manager, we know that. He’s a good man but he’s an awful manager,” Osmeña said in a press briefing on Thursday, March 13.
Asked if he was referring to Petilla or Aquino as the “awful manager,” Osmeña said, “Both of them.”
The senator said Petilla knew beforehand that the Malampaya plant goes on annual shutdown for 30 days. Yet he did not respond immediately when other power plants simultaneously went on unscheduled shutdown, causing power prices to spike.
He said Petilla should have ordered government’s Malaya plant to offer at the Wholesale Electricity Spot Market (WESM) to address the problem. (READ: 'Burn gov't plant if not helping consumers')
“So oops you got caught with your pants down so you react right away. I would have told Malaya, make your offer, that’s 600 megawatts. He did not. Yolanda hit his province so right way he was diverted. He had two huge problems when he should have taken care of one problem: DOE. He was running around also in Leyte. I can understand that but who’s taking care of the energy problem affecting all of Luzon?”
Osmeña, chairman of the Senate energy committee, said that when he called for a hearing into the power rate hike, Petilla could not attend the inquiry as he was focused on restoring power in areas affected by Super Typhoon Yolanda (Haiyan). The world's most powerful storm toppled power lines in the Visayas, including Leyte.
“The undersecretary he sent [to the hearing] was appointed two months before, his person from Leyte and he didn’t know anything about power. We’ve had the biggest headache and he sends somebody who doesn’t know power. What does that tell you about the way things are being managed?”
The senator said he did not schedule Petilla for confirmation because he will just be “embarrassed.”
“He keeps being reappointed. I’ve not scheduled [him]. No. I can schedule him but he’ll be embarrassed because I’ve had a lot of tough questions and I don’t want to embarrass him.”
'Good politics, bad economics'
Osmeña cited the order of the Energy Regulatory Commission (ERC) to recalculate the rates on WESM during November to December 2013. The body said the rates could not qualify as "reasonable, rational and competitive."
While he agreed with the ERC decision, Osmeña said the regulatory agency should have not approved the hike in the first place.
"It's what we call good politics but bad economics. I talked to one of their members and I said, 'You can only do this one time. You cannot do it again. You used up your trump card. You do this again, investors will not believe us again and we'll have a real shortage in the decades ahead."
Osmeña said the ERC order does not bode well with investors because the ERC "changed the rules" in an industry that relies on long-term planning.
'Stop appointing politicians in energy'
Osmeña stressed that political appointees are a huge factor behind the problems in the power industry. He cited the case of the late Energy Secretary Angelo Reyes, former chief of staff of the Armed Forces of the Philippines.
“In 2007, we had a retired general. That guy couldn’t spell the word transmission. Why put a guy like that there?”
The senator called on Aquino to fill the vacancy at the ERC by appointing a non-lawyer. He said there are too many lawyers at the regulatory body.
“Get some experts in the power industry there. I’m not saying everybody should be an energy engineer but you need a good balance. They put an accountant, that’s very good but you need somebody with expertise in computers, electrical engineering, power engineering, power economics. You need economists more there than lawyers. One lawyer is enough.” – Rappler.com