Warns against using power outages to justify contracts

Bayan Muna chairman Neri Colmenares and Rep. Carlos Zarate filed a petition at the Supreme Court today to declare as null and void several “sweetheart deals” that Meralco negotiated with its own generating companies in 2016, saying these would burden consumers with high power rates for the next 20 years.

In a “Petition-in-intervention with an application for urgent relief by way of Temporary Restraining Order (TRO) and/or Writ of Preliminary Injunction,” Colmenares and Zarate asked the SC to allow them to intervene in the case originally filed by Alyansa Para sa Bagong Pilipinas, Inc. in 2017.

In their petition, Colmenares and Zarate said the Energy Regulatory Commission allowed Meralco to skirt its competitive selection process (CSP) rules for buying power. Said rules requires power distributors to get at least two offers for supply of electricity before awarding a power supply agreement (PSA), ensuring the least cost for electricity consumers.

They alleged that by extending the CSP deadline from November 2015 to April 2016, the ERC allowed Meralco to enter into seven power supply agreements (PSAs) with its affiliated power generating companies, tying up 3,551 megawatts, or 90% of its supply, to 20-year contracts that would cost consumers P12.44 billion a year.

They warned that historically, Meralco’s negotiated contracts with its subsidiary companies were overpriced by as much as 20% compared to those of non-related generating companies.

They asked the High Court to nullify the ERC’s order to extend the CSP deadline, and declare null and void Meralco’s PSAs that did not undergo the required competitive bidding process.

“We believe that some ERC officials bent backwards several times to accommodate these Meralco power deals. We repeat our vow to oppose these PSAs and hold officials who allow it accountable,” Colmenares said.

Power interruptions shouldn’t justify contracts

Meanwhile, Colmenares warned Meralco and the Energy Department not to twist information about Luzon’s tight power supply situation to stampede the public into accepting the seven controversial PSAs.

“We monitored a recently published pronouncement by a Meralco official who tried to link the recent shutdowns of several power plants to a power supply deficiency. This is fake news,” Colmenares said.

“In fact, the Department of Energy even assured the public that we have enough supply of electricity this summer. Information from the website of the country’s grid operator also indicates a normal power situation in Luzon,” Colmenares added.

“The recent unscheduled plant shutdowns should not be used by Meralco or ERC to advance their dubious agenda; and that is to get public support for the overpriced PSAs,” Colmenares stressed.

“The power plants it wants constructed are clearly the very power plants awarded with the onerous PSAs by their parent firm Meralco,” Colmenares bared.###

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