CASTRO URGES PASSAGE OF POWER BILL

DEPUTY Minority Leader and ACT Teachers Rep. France Castro urged Congress to pass House Bill 8079, which seeks to prohibit power distribution utilities from owning power generation facilities.

Castro said HB 8079, or the proposed Electricity Consumer Protection Against CrossOwnership Act, would prevent distribution companies from owning power generation plants or having stakes in them.

“If the distribution utility also owns the generation company, it will be in its financial interest to pay a higher generation cost,”she said. “In other words, cross-ownership brings about a conflict of interest that the distribution utility will resolve to fatten its pockets rather than lower electricity rates to consumers.”

“Given that the generation cost of electricity is passed on by the distribution utility to the consumers, the higher the generation price, the higher the rates the consumers will pay,” she said in the bill’s explanatory note.

“If House Bill 8079 — prohibiting ownership by electricity distribution utilities in electricity generation companies and retail electricity suppliers — had been enacted, the supermerger created by MVP/ Meralco-RSA/SMC-Aboitiz would not have happened,” Castro said, referring to the $3.3 billion megadeal between Meralco, San Miguel Corp. and Aboitiz to take over a liquefied natural gas facilities in Batangas.

The Philippines has among the highest electricity rates in Asia, a deterrent to foreign investors.

“Despite 20 years of the Electric Power Industry Reform Act or Epira, the country has not moved from its top spot in the world’s most expensive electricity list,” Castro said. She said one of the “flaws” of the law was the provision allowing cross ownership of utilities of generation plants.