It’s peco vs government biz leaders express differ on power distribution issue

By: Emme Rose Santiagudo

THE battle for the power distribution services in Iloilo City between MORE Power and Electric Co. (MORE Power) and Panay Electric Co. (PECO) continues even though the former has already secured its franchise.

But Provincial Local Economic and Investment Promotion Officer (LEIPO) Velma Lao said the real battle is now between PECO and the government.

“It’s not even a fight between PECO and MORE Power. It’s PECO and now the government if they try to be hard on this,” Lao said during a forum organized by the Iloilo Economic Development Foundation Inc. (ILED) with MORE Power and the business sector at Hotel Del Rio on Feb 28, 2019.

PECO, the existing power distributor, is firm on its stand that it will not sell its assets to the new player.

PECO, whose franchise expired on Jan 19, 2019, still has a pending application for franchise renewal (House Bill No. 6023 submitted in July 2017) in the House of Representatives’ Committee on Legislative Franchises.

According to Lao, PECO has been given time to improve their business but was unable to deliver the needed services.

“That is true they have been given the time to improve their business efficiency, but they have not delivered so now the people are clamoring for efficient services. We need better services for more investments to come and this does not affect the city but also the province,” she stressed.

Halley Alcarde, Asst. Vice President of Gaisano Capital also supported Lao’s stand and underscored the right of the government to do what is right for the people.

“The government right now has the balls to do and implement what’s due and right for the people,” he said.

In the past years, Alcarde also questioned the previous utility of how it was unable to lower down the price.

“Nakita natin na pwede pa la nating mapababa yung cost ng electricity by sourcing out sa other suppliers, how come indi natin ginawa for the past years,” he said.

Alcarde lamented that investors have been clamoring of the high-power cost in the metro.

“Everytime we presented Iloilo, to businessmen and investors, they always say that your power is very high naencounter namin yan,” he said.

MORE Power CEO and President Roel Castro assured business leaders during its presentation that is has cheaper cost compared to the existing charges with an indicative potential savings of P1.21/kilowatt-hour (kWh).

Castro said they have been negotiating with possible power producers in the Visayas, AP Renewables Inc, KEPCO SPC Power Corporation, and Palm Concepcion Power Corporation offering power supply at the least cost.

“They are offering 1/3 less of the existing power generation, which is P7.84 kWh as of January 2019. That is P6.63/kWh vs P7.84/kWh,” he explained.

University of the Philippines Vice Chancellor for Administration and Trade and Industry Board member Mary Ann Gumban lauded the presentation of MORE Power.

“I like the presentation, those complaints and problems which have been existing for a long time, they brought it into the surface because of the study and was formally presented. I think and believe that the solution that they are providing will be able to solve the problems and at the same time prepare the city for more investments,” she said.

Despite the continuing battle for power distribution, Gumban said MORE Power has advanced its claim on the legal battle.

“There is always uncertainty, the way I see it but MORE Power has already gained more legal grounds. The battle is on but MORE Power now has I believe advanced its claim on the legal battle,” she said.

But more than lowering the cost, Gumban emphasized the need for assurance and efficiency.

“The question I wanted to raise was the capability of MORE Power to take over the capability and management of an electric company how ready are they. We want total assurance of reliability to give us an efficient electric service. Aside from lowering the cost, we want efficiency to respond to the needs of investments,” she stressed.

Iloilo Federation for Information Technology (IFIT) chairman Jessraf S. Palmares claimed that potential investors in the business processes outsourcing (BPO) industry in Iloilo are already hesitant to come in because of the uncertain power scenario in the metro.

“There are iban na players who want to come in the city but they are hesitant to come in because of the issue,” Palmares told The Daily Guardian.

Palmares emphasized that the lack of assurance from the power distributor may force future and even existing investors to look for other sites outside Iloilo.

“The longer this issue stays we cannot assure that new investors will come in. Existing investors are telling us that they will be looking into other sites. The situation is preventing the investors from coming in,” he stressed.

According to Palmares, in the past few years, the current distributor, Panay Electric Co. (PECO) have met their requirements in delivering the necessary power supply needed in their industry.

“So far for the last few years, na grabe ang development naton, we have grown the industry fast which requires a lot of power, nameet man nila amon requirement,” he said.

Palmares added that they don’t have any issues with the existing distributor.

“As an industry wala kami issue, daw wala man kami problema sa ila, so ang ginamangkot lang namon why fix it when it’s not broken,” he said.

Palmares said cheaper cost is insignificant and emphasized their need for “reliability” above anything else.

“Yes, lowered ang ila cost but that is not how the industry thinks. The lowered price does not really affect us. Basta mahal pero reliable, so cost is not an issue to us. It’s more of reliability,” he said.

 

POWER-HUNGRY INDUSTRY

As a power-hungry industry, Palmares underscored the role of power in the BPO industry.

“Power is the umbilical cord because we operate 24/7 and internet connectivity,” he emphasized..

The BPO industry with its steadfast growth is targeting 30,000 employees by 2022, according to Palmares.

“We are still growing. Right now, we are looking into adding 5,000 seats. Kung may space lang, we are still growing, we are hitting our target of 30,000 employees in 2022,” he said.

With the current situation of power in the metro, Palmares only fears one thing.

“Ang problema lang is ang existing companies with all this problem will decide to pull out because of uncertainty,” he reiterated.

 

FOR THE BETTER

In the middle of all these, Iloilo Business Club (IBC) Executive Director Maria Victoria Lara hopes that the tug-of-war between the two power firms will be solved immediately.

“They have assured us na there would be, the public will not be inconvenienced, amo na ang aton ginapanghawakan. The sooner that all these things will be resolved, the better it is for consumers,” she said.

Aside from demanding assurances from the power firms, Palmares also hopes that the government will intervene for the issue to finally end.

“Ang amon prayer is ang government should intervene, the ERC para matapos bala tanan para may finality,” he said.

Republic Act No. 11212 signed by President Duterte on Feb 14, 2019 gave MORE Power the right to distribute electricity in the city.

It also authorizes MORE Power to establish, operate, and maintain, for commercial purposes and in the public interest, a distribution system for the conveyance of electric power to end users in the city of Iloilo.