Did Arroyo need emergency powers at all?

By Leilani Chavez, abs-cbnNEWS.com

Posted at Mar 10 2010 05:17 PM | Updated as of Mar 18 2010 09:32 PM

MANILA, Philippines -- Did President Gloria Arroyo need emergency powers to solve the power shortage in Mindanao?

According to energy experts and some lawmakers, no. They said the president has the necessary powers to address the rotating blackouts in Mindanao. They added that the proposal is ill-timed and very costly.

The proposed crisis powers for President Arroyo died a natural death and, on Wednesday, the Palace mulled declaring a state of calamity instead.

Emergency powers

In a budget deliberations in 2009, wary lawmakers raised the possibility of a energy crisis during the national elections as energy secretary Angelo Reyes warned of the projected shortage in the country.

The lawmakers then proposed emergency powers for the president to build additional generation capacities. Reyes then shrugged off talks of energy crisis during the elections. Instead, he said he will refer the situation to the president, who can declare an energy emergency.

Fast forward to March 2010. Reyes became more desperate as blackouts hit key parts of the country, including Metro Manila, the country's capital.

He recommended that the President proclaim an emergency situation in Mindanao to invoke Section 71 of the Electric Power Industry Restructuring Act of 2001.

The EPIRA prohibits the national government from building additional power plants in its aim to privatize the energy sector for a more efficient generation, supply, transmission and distribution. The law, says Reyes, prohibits the national government from acquiring generation capacities to augment the worsening supply in the Mindanao grid.

Sec. 71 of EPIRA, "Upon the determination by the President of the Philippines of an imminent shortage of the supply of electricity, Congress may authorize, through a joint resolution, the establishment of additional generating capacity under such terms and conditions as it may approve."

Since 2009, Mindanao had been experiencing rotational two- to three-hour blackouts, with some areas even experiencing blackouts for the whole day. The shortage has been blamed for the decreasing water levels in reservoirs caused by the El Nino phenomenon. The critical water levels limit the generating capacities of various hydroelectric plants, which supplies majority of Mindanao's energy demands.  

The President agreed to look into the recommendation but experts and groups are against the possible declaration.

Given but not used

Former National Power Corporation President Guido Delgado does not think emergency powers will answer the shortages in the power supply situation in Mindanao. Having experienced power shortages under the Ramos administration, Delgado said the situation does not merit emergency powers.

The scenario was a replay of the energy crisis during the early days of the Ramos administration where President Fidel Ramos was given emergency powers by Congress to sign negotiated contracts.

Emergency powers allow the President to sign contracts with independent power producers (IPPs) and skirt public biddings. Onerous IPP contracts made during the Ramos administration were eventually blamed for the rising cost of electricity in the country.

Although Ramos was given emergency powers, Delgado narrated that the former did not utilize it. Instead, Delgado said the contracts signed during Ramos's administration were properly bidded out.

Instead of giving the National Power Corporation (NPC) the leeway in acquiring modular generators, Delgado recommended alloting resources for electric cooperatives. 

'EPIRA has enough powers'

Even among lawmakers, debates rage in the lower house on the necessity of granting the president emergency powers.

The House Committee on Energy has approved the granting of emergency powers and recommended that the President declare a state of emergency. The declaration would call for a special session in Congress to pass a joint resolution to temporarily solve the crisis.

House Speaker Prospero Nograles, however, went against emergency powers. He reasoned that EPIRA already gave the Department of Energy (DOE) enough powers to address long-term energy supply.

According to Section 37d of the EPIRA, DOE is mandated to "ensure the reliability of quality, and security of supply of electric power."

Further, Nograles noted that a P500-million emergency budget was allocated in the 2010 General Appropriations Act in preparation for the power shortage.

As the resolution coincided with the national elections, lawmakers are busy for their campaigns and it would be hard to get a quorum.

Too costly

If Congress gave its blessings to grant the president with emergency powers, the NPC would have been provided with P5.5 billion for leasing modular generation sets.

Unlike full-fledged power plants, which take 3 to 4 years to build, modular generation sets can be set up in a month's time.

Even the energy secretary acknowledged that the price for these generation sets are costly. 

According to one energy expert, the P5.5 billion amount for the proposed generation sets during the "emergency" period is already enough to build a 100-MW coal plant with the latest clean coal technology.

"P5.5 million for leasing modular generators are expensive because they use diesel. That amount can be used to build up a 100-MW clean coal technology power plant," the energy expert told abs-cbnNEWS.com.

The expert also explained that the situation can be addressed even without emergency powers as there are other options available.

Groups are batting for emergency powers because they do not want to be accountable for possible problems, he said.