Bill seeks to keep hydro plants in state hands

May 14, 2012 at 11:14

A bill seeking to maintain government ownership of the Agus-Pulangui hydropower plants in Mindanao has been filed at the Senate in a bid to keep a lid on electricity prices on the island.

Titled, “Agus-Pulangui Privatization Exemption Act of 2012” and filed by Senator Gregorio B. Honasan II, Senate Bill No. (SB) 3182 amends section 47 of Republic Act No. 9136, or the Electric Power Industry Reform Act (EPIRA) of 2001, by adding the eight power plants concerned to the list of state generation assets exempted from privatization.

Under the bill, ownership and operation of the Agus-Pulangui plants will be “retained” with the National Power Corp. (Napocor).

“Except for assets of SPUG (small power utilities group) and the Agus and Pulangui complexes, the generation assets, real estate and other disposable assets as well as IPP (independent power producer) contracts of NPC (Napocor) shall be privatized,” SB 3182 read.

EPIRA required privatization of all state power generating assets, except for those under SPUG. It states that privatization in Mindanao, to include the Agus-Pulangui plants that provide more than half of the region’s power, was to begin 10 years after the law’s implementation. The Energy department, however, in 2010 sought deferment of Agus-Pulangi’s privatization until more generation plants are built. Last month, the government said new power plants could come on stream only by 2014.

“The privatization of Agus-Pulangui Hydro Power Plants will result to [sic] the loss of economic competitiveness of the power supply sector in Mindanao,” Mr. Honasan said in the bill’s explanatory note.

He added that “…[a] new private owner will… recover its investment by increasing the rates to be paid by the people in Mindanao.”

Moreover, “[s]elling the Agus-Pulangui Hydro Plants to just one private buyer will monopolize more than 50% of Mindanao’s power needs,” he warned further.

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By A. S. O. Alegado
Source: BusinessWorld, May 14, 2012
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