Meralco, Napocor agreed to pass debt to clients

MANILA, Philippines - The Manila Electric Corporation (Meralco) has struck a deal with the National Power Commission (Napocor) to pass its debt worth P14.7 billion to its consumers, GMA’s 24 Oras reported Monday. The television report said this was revealed during the hearing of the Joint Congressional Power Commission. According to the report by Maki Pulido, the debt was incurred when Meralco reneged on its 1994 agreement with Napocor and bought electricity with independent power producers (IPPs) instead. Under the agreement, Meralco was supposed to buy electricity from Napocor, a state-owned company that serves as the largest provider and generator of electricity in the country. This caused a P42-billion debt by Meralco to Napocor, but after negotiations it was trimmed down to P14.7 billion, the payment for which Meralco said will be sourced from consumers. The said agreement between Meralco and Napocor irked Sen. Miriam Defensor Santiago, who is co-chair of Joint Congressional Power Commission. “Aba! Nakakagulat ito. Nag-aaway ang Meralco at Napocor pero ngayon magkasama sila na ang utang nila sa isa’t isa na pinag-aawayan nila ay ipababayad na lang sa mga customers (This is unbelievable. Meralco and Napocor were always at odds with each other except when they agreed to pass on to consumers Meralco’s debts)," she said during Monday’s hearing. Since Meralco operates under a franchise, Santiago then directed its officials to cease from passing its debts to consumers. “Mayroon kaming kapangyarihan na bigyan kayo ng guideline (We have authority to issue a guideline) and the guideline is, do not pass the costs to the consumers," she said. Christian Monsod, a member of Meralco’s negotiating panel that attended the congressional inquiry, said the power firm did not violate any regulation when it passed its debts to consumers. “This is generation cost. Since generation cost is passable to consumers then the approval of (Energy Regulation Commission) would also involve the authorization to bill the consumers," he said. ERC, however, refused to comment on Monsod’s statement. But Solicitor General Agnes Devanadera has questioned the agreement between Meralco and Napocor, saying since the latter is state-owned, any deal involving debts should have the approval first of the President and Congress. “Dapat narinig ito ng OSG dahil ang boses namin ngayon ay hindi boses ng OSG bilang statutory counsel ng government kundi boses ito ng taumbayan (The Office of the Solicitor General should’ve informed of this agreement first. We are not representing the government in this case, but the public)," Devanadera said. Monsod, on the other hand, questioned the timing of Devanadera’s comment, saying the issue has been with the ERC for four years already. - GMANews.TV