ERC bent rules in power deals
THE Energy Regulatory Commission (ERC) twisted its own rules and allowed Manila Electric Company (Meralco) to file past the designated deadline time and day seven controversial power supply agreements (PSAs) that Meralco awarded outside the ERC’s competitive selection process (CSP) to favored power generation companies (gencos).
Representative Carlos Isagani Zarate of party list Bayan Muna noted the ERC’s irregular rules at the resumption last Oct. 11 of a House inquiry on ERC issues, including the postponement of the competitive selection process (CSP), the ERC’s very own program to get the least cost of electricity through a bidding process.
Zarate said that the joint House committee inquiry found out from an ERC employee that all of the seven Meralco PSAs failed to beat the deadline -- set on or before 5 p.m. of April 29, 2016 -- for filing of PSAs that did not undergo a CSP.
Sheryl Calinog, secretary of ERC’s general records division, told lawmakers under oath that four of the PSAs were actually filed on May 2, 2016 – or three days after deadline. But lawyer Jojo Tomas, then the ERC’s director for legal, instructed Calinog to put April 29, 2016, as filing date of the four PSAs.
Calinog added that the three other Meralco PSAs were filed between 5:30 p.m. and 7:25 p.m. – or past the 5 p.m. close of office hours -- of April 29, 2016.
Zarate said that, based on Calinog’s statements, the late filings violated ERC’s very own advisory, released on April 27, 2016, wherein the ERC reminded all distribution utilities (DUs) and electric cooperatives (ECs) to file their PSAs “before the close of the business hours (i.e. 5 p.m.) on 29 April 2016”, if they wanted their PSAs to avoid a CSP.
The advisory stressed that “afterwards, no PSA filed with the ERC will be docketed unless it has undergone CSP.” In other words, “the seven PSAs should be subject to a CSP”, Zarate stressed.
A program meant to cut down power rates, the CSP requires ECs and DUs like Meralco to receive at least two qualified bids for supply of electricity from gencos, with which the DU is not prohibited from entering into a power supply contract.
The seven PSAs, costing Meralco customers trillions of pesos over 20 to 21 years, call for the supply of 3,551 megawatts of electricity. Six of the PSAs went to gencos that either subsidiaries or affiliates of Meralco.
As the House inquiry resumed, ERC Commissioner Josefina Patricia Asirit explained that ERC employees “follow flexi time”. Her reply drew adverse reactions from lawmakers at the hearing.
- Bayan Muna