Ban cross ownership of power firms: Bayan Muna reps seek end to Meralco’s ‘sweetheart deals’

By Billy Begas

Bayan Muna Representatives have filed a measure seeking to ban cross-ownership between distribution utilities (DUs) and power generation companies (Gencos) “to stop the anti-consumer self-dealing transactions among these companies.”

House Deputy Minority leader Carlos Isagani Zarate urged the leadership of the House of Representatives to expedite the passage of the bill “so that it will put a stop to sweetheart deals among DUs and Gencos and genuinely deliver the least cost or lower power rates for our consumers.”

House Bill 9260 seeks to amend the Electric Power Industry Reform Act (EPIRA).

“The logic is simple. 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,” the explanatory note of the bill read.

Zarate also said collusion between DUs and Gencos could result to higher electricity rates.

“If the distribution utility also owns the generation company, it will be to its financial interest to pay a higher generation cost. 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.”

In the bill, Manila Electric Company (Meralco) was mentioned as owning wholly or partly seven GenCos namely Atimonan One Energy Inc., Global Luzon Energy Development Corp., Mariveles Power Generation Corp., Central Luzon Premiere Power Corp., St. Raphael Power Generation Corp., Redondo Peninsula Energy Inc., and Panay Energy Development Corp.

Source: Latest Politics News Today (Politics.com.ph)