Bayan Muna raps ERC chief Ducut over power rate hike collusion report

(Updated 4:41 p.m.) Bayan Muna party-list Reps. Carlos Isagani Zarate and Neri Colmenares filed criminal charges against Energy Regulatory Commission (ERC) Chairman Zenaida Ducut and three other ERC commissioners for supposedly failing to release a report that proves several power companies colluded to jack up electricity rates in December 2013.

 

In an 11-page complaint filed before the Office of the Ombudsman Tuesday, the lawmakers claimed that by sitting on the report Ducut, and ERC Commissioners Alfredo Non, Gloria Victoria Yap-Taruc and Josefina Patricia Asirit failed to implement the oversight functions of the agency, in accordance with the Electric Power Industry Reform Act (EPIRA), and violated Sections 3(f) and 3(e) of Republic Act 3019 or the Anti-Graft and Corrupt Practices Act.

 

The ERC executives also violated RA 6713 or the Code of Conduct and Ethical Standards for Public Officials and Employees by failing to release the report almost a year after an investigation into the controversial electricity price hike began on December 26, 2013, the legislators added.

 

“Respondents are guilty of wantonly and deliberately neglecting or refusing, after repeated demands by the people and  after repeated commitments [by them] to publish the result of the ERC investigation on the reported collusion, within a reasonable time, for the purpose of giving undue advantage in favor of the interested parties,” the complaint read.

 

In December 2013, ERC allowed Manila Electric Company (Meralco) to increase electricity rates by P4.15/kWh in three tranches from December 2013 to March 2014 on the back of higher generation costs incurred from buying higher-priced electricity at the Wholesale Electricity Spot Market (WESM) in November.

 

The Supreme Court, however, issued a temporary restraining order to stop Meralco's record-high power rate increase.
 

‘Highly unjustified’ failure

 

Ducut and the other ERC commissioners had made several commitments to publish the investigation report on the supposed collusion of power generating companies during the Malampaya shutdown in November 2013, but failed to fulfill them, according to Zarate and Colmenares. 

 

ERC first promised to release the report on January 6, 2014, which it then re-set to March during a Senate investigation into the alleged conspiracy of power industry players. At the plenary budget deliberations in the House last September, the commissioners again committed to publish the report by October 25 but until now, no such document has been released.

 

For the lawmakers, ERC’s failure to publicize the report is “highly unjustified” considering it concluded last March that “it has definitely established that the contrived supply shortage impaired the market and this resulted to market failure.”

 

“Seven months (from the ERC March 3, 2014 Order) is certainly and unjustifiably long time to ‘investigate’ the identity of those that withheld their capacity since these are of record even before March 3, 2014,’” they said.

 

In contrast, the Philippine Electricity Market Corporation (PEMC) had already identified those that withheld their capacities and therefore violated WESM’s “Must Offer Rule” in a report submitted in January 2014 and another in August 2014.

 

The PEMC report was so detailed it not only listed the power plants and the violations that were committed, it even cited the number of violations and the accompanying fines and penalties against the power companies, the lawmakers noted.