From bad to worse

The talks stem from Meralco's unpaid bills with state-owned National Power Corp. (Napocor), the exact amount of which is still in dispute. Some quarters say P50 billion; others say P14.3 billion in accordance with the terms and conditions of Meralco's settlement agreement with Napocor.

Whatever the amount is, those pushing for a hostile takeover of Meralco are pushing for the conversion of the debt into equity. That would give the state-owned power generator a decisive stake in Meralco. But that will be the last straw in arousing public anger.

I have little confidence in the way Meralco is running its affairs. As I had mentioned, Meralco has done little to involve its consumers in the running of the company. Meralco has been a little high-handed in treating its customers and, naturally, a lot of people are mad at not only the bills we pay but also the way we get our services.

But that is not to say that things will be better with Meralco under government control. Judging by the way things are going at Napocor, it will be a transition from bad to worse with the so-called Napocor Mafia getting still another playground through which poor Filipinos will be unwillingly fleeced.

These last few days have been marked by intermittent power outages in Luzon. All the while, residential customers of Napocor at the 200-kilowatt-hour (kwh) monthly mark are set to pay an additional P149 for the same amount of power. That is equivalent to an 8.95 percent increase or roughly the value four kilos of commercial rice. A household at the 100-kwh threshold will be paying P61 more. That may not seem like much but if you multiply it by the number of affected households, it is clearly a fat sum of money.

Power rate increases are inevitable as fuel prices are soaring. There is no dispute about it. But Napocor's inefficiency is adding to our misery. Napocor has the gall to announce that the country has enough supplies of fuel to run its coal-fired plants that comprise more than 25 percent of our total generating capacity. And, yet, we are being subjected to these power rate hikes on account of the rising cost of coal as well as the high price of energy being bought at the Wholesale Electricity Spot Market (WESM).

When Meralco was asked to explain its high power rates, it was forced to disclose the fact that its most expensive source of power was from the WESM. Where is the efficiency in that? We have adequate supplies but we are at the immediate mercy of prevailing world coal prices? Or does Napocor really mean to say that we have been committed access to deliveries of coal provided we pay for it. One can only conclude that the stuff is not actually here but still in transit, to arrive at a time when it is needed but at a price that is designed to hurt our pockets the most. For all the vast sums of money supposedly made by Napocor at the time when the value of its dollar-denominated obligations were greatly reduced due to the strong value of the peso, Napocor officials did not take the opportunity to at least stock up on coal? Is that good management doctrine?

We can say what we like about Meralco but it cannot be denied that it is a publicly-listed company. It is still bound by the punishing discipline of the free market. Sadly, nothing like that can be said about Napocor. It knows nothing of being publicly-traded and acts very much like the monopoly that it is.

It cannot even properly dispose of the power plants as it is mandated to do under the Electric Power Industry Reform Act that will reduce its market dominance in power generation to a more acceptable 30 percent of the total. To put Meralco under the control of the Napocor Mafia is one sure way of telling investors to get out of the country because the government intends to sink the local stock market. Just so a privileged few can make a lot of money from the blood and sweat of poor Filipinos like you and me.