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Cross ownership ban on power sector mulled

HOUSE Deputy Minority leader and Bayan Muna Rep. Carlos Isagani Zarate said they are studying the filing of a bill that will ban cross-ownership between distribution utilities (DUs) and power generation companies (gencos) “to stop the anti-consumer self-dealing transactions among these companies.”

“This amendment to ban cross-ownership between DUs and gencos is now becoming a must in the meantime that the Electric Power Induatry Reform Act (EPIRA) is not yet fully repealed,” said Zarate.

Zarate issued the statement as the Energy Regulatory Commission (ERC) ordered Meralco to refund P1.4 billion in excess collection of the transmission charge, systems loss charge, lifeline subsidy and senior citizen subsidy.

However, this “victory for consumers is a phyrric one” as the ERC also ordered the recovery from consumers of P2.38 billion supposed undercollected generation charges by Meralco.

“These types of bigay-bawi schemes are what we are trying to prevent especially since we are still investigating the billions of overcharging of Meralco in the past years. Sa halip na makaluwag ang consumers ay lalo pang masisingil ng mahal dahil kalakhan naman ng generation companies ngayon ay may parte o buong pag-aari ng Meralco at iba pang DUs,” said the Deputy Minority leader.

“Only a ban on cross ownership can now save Meralco customers from higher rates that Atimonan One will submit – and Meralco will surely accept — during the Meralco bidding in January 2021,” said the Davao-based solon.

In 2016, Meralco made an attempt to award to Atimonan One a 1,200-MW power supply agreement (PSA) that was discovered in a congressional inquiry to have contained terms onerous to consumers. This PSA, along with six other controversial supply contracts that Meralco also awarded to affiliated gencos, was nullified by the Supreme Court in May 2019 for Meralco’s disregard of CSP rules.