Costlier energy inevitable

By Herbert Vego

NO consumer wants an increase in prices of basic commodities. It’s a truism that applies to electricity, which is a critical component of our comfort zone. However, we have to embrace that reality – unless we are willing to slide back to the “kingki” period.

Still we see people criticizing the electricity-distribution utilities for the new wave of price hikes to the point of ignoring their past successes in keeping prices low. This is especially true in the case of MORE Electric and Power Corporation (MORE Power for short) – the distribution utility (DU) in Iloilo City which, in the last 14 straight months, has held the reputation of being the distributor of cheapest power in the Philippines.

Of course, the concerns posted in social media are legitimate. But it is unfair to blame the DUs for higher rates per kilowatt-hour. Take for example the forthcoming billing of MORE Power the month of September billing; its residential electricity rate would increase by P3.34 per kWh – from P9.14 to P12.48 per kWh.

If he had his way, MORE Power’s President Roel Z. Castro would prefer to keep prices down.  In fact, he has been doing his best to scout for the lowest possible contract with various power suppliers.

The believable reason for MORE Power’s forced price hike is the expiration of its contract with the Power Sector Assets and Liabilities Management (PSALM) Corporation for cheaper geothermal energy. That form of renewable energy, now contracted with the Energy Development Corp. (ERC), is no longer contractable at the old price. It’s so scarce that most DUs have to rely mainly on coal-fired power plants. The average price of coal in the world market has jumped from US $60 to $405 per metric ton, indicating a 575% increase.

Oh, well, there’s the inflation of the peso against the dollar to blame, among others.

The increase in distribution rate is therefore a direct effect of increased charges in power supply agreements with energy generators. It would therefore be inaccurate to blame the DUs which could no longer survive on old rates. As this corner has already pointed out, 51% of the power bill would pay for power generation, only 26% for distribution, 9% for transmission via the National Grid Corporation of the Philippines (NGCP), and the rest for government-imposed taxes, system’s loss and universal charges.

As to why the DUs could not peg the same pricing, we can only vaguely say it depends on different factors – say, the economies of scale for example.

As far as Western Visayas is concerned, Guimaras Electric Cooperative (Guimelco) will be distributing the lowest power bill this month at P12.17, just a few centavos lower than MORE Power’s P12.48. The other electric co-ops in the region will charge from P13.46 (ILECO-1 in Iloilo) to the highest of P17.03 (ANTECO in Antique).

Naku, ANTECO ha? Gano’n na kayaman ang Antiqueños?



WE saw the video of our good friend, Uswag Ilonggo party-list Rep. James “Jojo” Ang asking DPWH Sec. Manuel Bonoan in a House hearing for updates on the proposed Panay-Guimaras-Negros Bridges at the House of Representatives Friday.

All that the latter could say was an assurance that the Eximbank of Korea had committed to finance the Panay-Guimaras span but not the longer Guimaras-Negros.

The congressman had been a contractor for years, perhaps in as many years that the project has existed in the dreamland.  It is safe to say that he was among those who had wished to have a share of the pie, to see it from the lighter side.

I remember that the late Congressman Albertito Lopez was the first to promise the Iloilo-Panay stretch way back in the time of Pres. Cory Aquino, but to no avail.

Thousands of Ilonggos must have died disappointed while wishing for that wish to materialize.



ILOILO CITY Mayor Jerry P. Treñas flew home from Kuala Lumpur, Malaysia the other night. He had breezed through three days of the 9th CityNet Congress there from Sept. 20 to 23. The CityNet is the largest association of urban stakeholders committed to sustainable development in the Asia-Pacific region with the support of the United Nations.

He bagged the honor as the No. 2 member of the Executive Board of CityNet for the next four years. The network includes 173 municipalities, non-government organizations, private companies, and research centers.

During the assembly, Treñas reported on Iloilo City’s efforts to provide socialized housing, ensuring a roof over the head of every Ilonggo. There is still a need for 16,000 more housing units to be constructed.

The other mayors present in the CityNet congress must have heard about the swift transformation of Iloilo as the new business and tourism hub in the country.

“They would like to visit us,” Treñas revealed.