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Monday, August 14, 2006
Mindanao bloc lauds lower power rates
ELECTRIC consumer coalition Mindanao Power Block (MPB) Sunday welcomed what it described as positive effects of the country's power sector liberalization.
The wholesale electricity spot market (WESM), through which generators can sell the electricity they produce, provides a market-driven venue which will make electric rates cheaper to poor consumers, said Cagayan de Oro Councilor Jose Benjamin Benaldo, MPB president and chair of the City Council energy committee.
Under an environment of free competition among electric generators, WESM provides an open and transparent market which Benaldo said will benefit both ordinary electric users and small and medium enterprises.
Benaldo also lauded Malacañang's promised reforms on the power industry, specially the opening of access and retail competition by distribution of utilities at the level of household industries and businesses.
President Gloria Macapagal-Arroyo said those reforms would lower further the cost of electricity, saying that under WESM alone, electric rates have decreased more than P100 in the electric bill of a household consuming 200 kwh a month.
Energy Secretary Raphael Perpetuo Lotilla said the reduction is relative to the cost of electricity in May to July but would translate to a 79-centavo decline if compared with the cost of power in July alone.
Lotilla said the decrease would be seen in the generation charge. But Benaldo said WESM still has snags that can only be fined-tuned through legislation in Congress.
Under the present set-up, he said a large number of power distributors still maintain their own generation companies -- therefore providing an avenue for monopoly or the creation of an energy cartel.
He said the Energy Power Industry Reform Act, upon which WESM stems, should be amended by Congress to prohibit cross-ownership of both generation and distribution components by a lone entity.
Only through this, he said, can the power industry be fully liberalized to the advantage of all consumers. (Danilo V. Adorador III)
(August 14, 2006 issue)
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