The NGCP controversy should be an election issue

"The agency held both the Philippine government and the Filipino people hostage."


To all intents and purposes, the election season has begun.  Sadly, the campaigning has been relegated to personality politics.  

My intention in this column is to remind the electorate about the the alarming problem of the country involving the National Grid Corporation of the Philippines (NGCP), its ties to the Communist Party of China, and the need for the electorate to ask what candidates for president, senator and congressional representatives intend to do about the NGCP mess.  

Last June 18, I wrote an essay under this column entitled “Communist China controls the nation’s electricity supply.”

In that essay, I pointed out that back in 2008, Congress enacted Republic Act No. 9511, the franchise of the NGCP, a private consortium composed of three corporations -- the Monte Oro Grid Resources Corporation, the Calaca High Power Corporation, and the State Grid Corporation of China.  The latter is completely owned by the Communist Party of China and is reported to be the largest utility company in the world.

That legislative franchise gives the NGCP a monopoly in the management of the national electricity grid of the Philippines, but its operations must be in accord with implementing directives issued by the Department of Energy (DOE) and the Energy Regulatory Commission (ERC).  

The national electricity grid is a computerized system of inter-connected power plants and power distribution outlets all over the Philippines.  It is supposed to be closely monitored by the NGCP to determine and predict where and when electricity is most needed.  

To assure an uninterrupted supply of electricity at any given area where the demand for it is very high, the NGCP adjusts the grid so that its affiliated power plants, which are mandated by law to be ready at all times, can supply the increased demand for electricity in that particular area.  The grid also rechannels electricity from areas where the demand is less to places where the demand is great.

Under that arrangement, unplanned power failures anywhere are not supposed to take place.

In sum, the NGCP controls the supply of electricity throughout the Philippines, and the DOE and the ERC monitor its operations in accordance with applicable Philippine laws and administrative regulations.

The applicable law is Republic Act No. 9136, or the Electric Power Industry Reform Act (EPIRA), enacted by Congress in 2001 to ensure a continuous supply of electricity in the country at reasonable cost to residential and industrial consumers.

As to the pertinent administrative regulations, they are the Philippine Grid Code promulgated by the ERC, and a circular on ancillary services issued by the DOE.  The Code and the circular implement the EPIRA.  

In June 2021, the NGCP announced on social media that it is not bound by the Code and the circular.  

Because the NGCP refuses to obey the Code and the circular, unannounced power outages plagued the entire Philippines during this year’s hot and dry summer months.   Worse, those “brownouts” will continue intermittently next year if the NGCP continues to ignore the Code and the circular.

In manifest violation of its legislative franchise, the NGCP also allowed several of the power plants affiliated with the national electricity grid to stop operating, supposedly because it is expensive to keep them running continuously.   

To keep the supply of electricity continuous, the NGCP told the government that the NGCP will have to buy electricity from power plants that are not affiliated with the national electricity grid.  Because those power plants are free to quote spot prices, the purchase price of the electricity they sell is very expensive.  This translates to higher electricity bills for all of the country’s consumers.

Adding insult to injury, the NGCP threatened to increase the cost of electricity to be paid by consumers if the NGCP is required to comply with the Philippine Grid Code and the DOE circular.  

    Simply stated, the NGCP made hostages of both the Philippine government and the Filipino people by declaring that there will be no hikes in electricity bills if the NGCP is allowed to violate its franchise and to ignore the EPIRA.

Obviously, the Communist Party of China, which controls the NGCP, is using our nation’s demand for electricity as a weapon against the Filipino people.

It was also discovered that the NGCP has been hiring Chinese nationals for its management posts.  This is a violation of the constitutional provisions on alien involvement in public utilities, as well as the Anti-Dummy Law.

In short, Congress has valid reasons to cancel the NGCP franchise.    

Accordingly, I urged Congress to cancel the NGCP franchise.  Unfortunately, any congressional action in that direction may not be forthcoming in view of the coming elections.

What is important now is that voters are informed about the NGCP controversy.  I will see to it that this controversy will be a hot issue in the coming elections.

Topics: Louis "Barok" Biraogo , National Grid Corporation of the Philippines , NGCP , Communist Party of China
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