Group seeks abolition of WESM, repeal of EPIRA
A GROUP of former executives of the National Power Corp.(Napocor) has called on the government to abolish the wholesale electricity spot market ( WESM) as part of its overall move to repeal the Electric Power Industry Reform Act (EPIRA).
In a position paper submitted to the House Committee on Energy, retired Napocor engineers led by former vice-president for operations and engineering Hector N. Campos, Sr. said WESM trading has since worked counter to the original goal of the Electric Power Industry Reform Act of 2001 to ensure stable supply and trim electricity prices in the Philippines.
“Free competition through the wholesale electricity spot market is also a sham because of virtual monopolies and crossownerships between distribution utilities and power generators fostering competition,” the Napocor retirees said in a 10-page position paper. “After 10 years of implementation, EPIRA has clearly failed to live up to this promise. On the contrary, the law has resulted in the doubling of power rates.”
The fixed generating prices for load dispatching — instead of the WESM-quoted prices — should be brought back to effectively trim power costs, Mr. Campos’s group also said, while adding that charges being imposed by the Manila Electric Company also demand a “critical review.”
The passage of the EPIRA during the term of former President now Pampanga Rep. Gloria Macapagal- Arroyo privatized power facilities and established the WESM, a trading platform for electricity supplies which determines the price of power based on the highest offer made by private generators every hour.
Former Napocor executives cited the record-high price spikes at the WESM in November-December 2013, which could have led to a P4.15 per kilowatt hour increase in electricity charges had it not been stopped by the Supreme Court.
Besides abolishing the WESM, the group is likewise lobbying for the eventual repeal of the EPIRA, which they say is within the President’s authority.
Repealing the EPIRA would effectively “revert to the government management and regulation” of generation, transmission, and distribution of electric supply in the country, which they see as the solution to trim power prices.
Currently pending before Congress are 16 House bills and two Senate bills seeking to amend provisions of the 14- year- old power sector law, mainly to provide mechanisms to fast-track the grant of project permits, remove value-added taxes for power generation, and to beef up the powers of the Energy Regulatory Commission, among others.
Similarly, the House Makabayan bloc has filed a measure that seeks an outright repeal of the EPIRA, calling for the government to buy back power utilities.
The measures are now being tackled under a technical working group at the House.
However, at the Senate none has been picked up. Senate energy committee chairman Sergio R. Osmeña III earlier said that such moves to amend or repeal the EPIRA would not prosper, as it is impractical to do so.
Business groups have since opposed moves to amend the EPIRA, saying it is a well-crafted piece of legislation.
The Napocor and the Department of Energy should also be given back their power to build and run power plants to remove the monopoly among the private sector, the group added. —