The consumer advocacy group Laban Konsyumer, Inc. urged the Energy Regulatory Commission (ERC) over the weekend to investigate the recent unplanned outages of several power plants and to protect consumers from the impact of high world oil prices.
LKI president Vic Dimagiba said the recent increases in world oil prices coupled with the unplanned plant outages add a burden on consumers, as these factors add pressure and jack up the power rates charged by distribution utilities and electric cooperatives.
“Instead of just conditioning the minds of the public that power rates will increase in the coming months, the ERC should also investigate, reprimand and even penalize these power producers for their unplanned outages, as these pressure the generation costs to increase, which are eventually charged to many hapless consumers,” he said.
Dimagiba said power producers should always ensure that their power plants are well maintained, and that they have the necessary spare parts available onsite in case equipment breaks down.
“The penalties must also be severe to encourage these power producers to improve their services and to ensure their facilities are well-maintained to avoid any occurrence of unplanned outages,” Dimagiba said.
Dimagiba said the tight supply resulting from these unplanned outages could also have been managed better if there were more reserves.
Dimagiba said no additional capacity has also been put up in the last six years, which he said was critical given the bullishness and projected economic growth at the start of the current administration.
“The Department of Energy (DOE) should do everything in its power to make sure committed power projects, especially those that can boost our available baseload capacity, will come online and on time. It should also push more investors to put up the much-needed generating capacity that we need to support the country’s growing energy requirements,” Dimagiba said.
He said increases in world oil prices not only affect the cost of transportation and production of basic goods and services, but also directly affect the cost to produce electricity.
When fuel and power prices increase, prices of food and other commodities follow suit as well, he said.
He said that since the Malampaya gas-to-power project is indexed to world oil prices, consumers will experience the impact of the high oil prices.
Power distributor Manila Electric Co. expects the impact of the high oil prices to be felt in the May billing of consumers.
“The government needs to act fast in finding a solution that would shield consumers from bearing these unwarranted costs to produce electricity during these challenging times,” Dimagiba said.