We should not be afraid of changes. We should not be afraid of reforms
When it comes to change, Filipinos tend to be reluctant and fearful.
This is amidst the fact that change and reform can provide real solutions in addressing decades of societal issues and problems.
And this holds true in the power industry, where many had initially feared and hindered the privatization of electric utilities.
But eventually, these changes had brought in great relief to the public
Talking about change and relief, Sen. Grace Poe, Chairman of the Senate Committee on Public Services, had boasted the benefits experienced by residents in Iloilo City when the franchise of Panay Electric Company (PECO) was not renewed, which paved the way for the entry of new player More Electric and Power Corporation (MORE Power) in February 2020.
MORE Power invested P1.5 billion to replace the ‘ageing, obsolete and dilapidated’ power distribution facilities in Iloilo City.
Hence, in its first year of operation, MORE Power managed to address the frequent brownout, high electricity bill, large system losses, and other power-related problems in the city.
Residents in Iloilo City had experienced a dramatic reduction in their electricity bill – from the previous P13 per kilowatt hour, the power rate significantly dropped to P6.40 kwh, and this is one of the lowest electricity rates in the entire country.
MORE Power’s effort in rehabilitating the power facilities had brought remarkable progress as they were able to address the systems loss factor, illegal connection, power interruptions and overloading.
MORE Power is a living proof that modernization funds will indeed provide real and efficient solutions to the problems in the power sector.
This glaring reality haunts the 121 electric cooperatives in the country which practically have no funds for modernization.
Their facilities can no longer keep up with the current demand resulting in poor service.
Power supply crisis is serious and widespread in the country.
In fact, the Senate Committee on Public Services and the Committee on Energy are conducting a joint investigation of the rotational brownouts experienced in Panay, Negros, Nueva Ecija, Northern Samar, Pampanga, San Isidro and San Jose in Nueva Ecija, Calaca in Batangas, Quezon province, Tabuk City in Kalinga, South Cotabato, Maguindanao, Ozamiz, Lumban in Laguna, Zamboanga City, Pangasinan, Tarlac, Marinduque, Camarines Norte, Echague in Isabela, Zamboanga Sibugay, Masbate, Davao Oriental (near my hometown), Southern Leyte, Casiguran in Aurora, and Bicol.
During the Senate Inquiry, Sen. Poe pointed out that the electric cooperatives were being loaned with government funds.
They were also given incentives to improve the service in rural communities.
However, cooperatives still cannot keep up with the demand.
And this is something that is really unacceptable for I could not fathom and comprehend why those electric cooperatives were still given subsidies worth millions by local government units to operate.
In the course of investigation, one very important thing has prevailed – modernization is really necessary to address the decades-long problem of power supply.
Electric Cooperatives are managed by the National Electrification Administration.
Based on their website, as of June, NEA had extended a total P560.66 million loan assistance to 18 Electric Cooperatives.
But despite the large amount of loans extended to the cooperatives every year to strengthen the technical, managerial capability and financial viability of the ECs, the fact remains their resources for infrastructure development are still insufficient and limited.
And because of limited resources, it is difficult for ECs to implement new technologies and innovations compared to big private sector utilities that have large financial resources.
Hence, it is no surprise the private sector has more capacity to implement immediate infrastructure upgrades, technological advancements and operational efficiencies with reliable results and quality service.
So one of the solutions Sen. Poe sees is the entry of private players like MORE Power – for her this is the key in improving the power service because of their large capitalization.
We should not be afraid of changes. We should not be afraid of reforms.
We should not be afraid of the privatization of electric cooperatives because the Energy Regulatory Commission has regulatory oversight power to ensure quality standards, fair pricing and that monopolistic practices are avoided.
(The author is a civil engineer and a longtime resident of the Davao area, with his own small construction business)