Ping asked to dialogue with groups calling for role in Yolanda rehab

Press Release

December 31, 2013

The Partido ng Manggagawa (PM) called on Yolanda rehabilitation czar Panfilo Lacson, agencies involved in the reconstruction plan and international aid groups to dialogue with workers associations in Leyte demanding decent jobs and people’s participation.

Yesterday a motorcade of a hundred tricycles garbed in tarp posters with the message “Make jobs a priority in Yolanda rehab,” went around Tacloban City and were warmly received by typhoon survivors. The motorcade signaled the launch of the campaign for decent employment, social protection and people’s participation as bedrocks of Yolanda rehabilitation and reconstruction plan.

“Yolanda survivors should be treated as citizens not beggars. It behooves Ping, rehab agencies and donor countries to engage with the Leyte informal workers in the reconstruction plan. Inclusive growth is mere lip service, people empowerment is just a buzz word without the actual participation of organized groups at the grassroots,” insisted Wilson Fortaleza, PM spokesperson.

Before the motorcade, the tricycle drivers attended a noon mass at the Sto. Nino Church. A gathering and small salu-salo followed the motorcade at the church’s social hall where family members and other Yolanda survivors gathered to hear the groups’ manifesto and affirm their commitment to the collective struggle of rebuilding their lives and their communities.

“In the rehabilitation and rebuilding process, we do not want to just revert back to where we were before Yolanda. We want a new community–a better community,” declared Judy Torres, PM-Region 8 coordinator and chair of the Tacloban Federation of MCH (Motor Cabs for Hire) Drivers and Operators Associations, Inc. (TAFEMDO).

The campaign came days after the government announced the US$8.17-billion or P361-B plan under the so-called Reconstruction Assistance on Yolanda (RAY) which will be completed in four years.

In a joint manifesto signed by TAFEMDO, Trisikad Operators and Drivers Organization of Hilongos, Leyte, Rebolusyonaryong Alyansang Makabansa-Region 8 and PM, the groups explained that prior to the onslaught of Yolanda, they were already living miserable lives since transporting people around the city through motorized and non-motorized cabs for hire was their only source of income. 

“Our priority demand is decent jobs because it is a guarantee to a person’s long-term security and a life of dignity,” said Torres, adding that while everybody was devastated it is the poor that suffered most.

He added that “Today’s extreme weather systems are the awful outcome of climate change caused by unrestrained economic activities of industrial countries. Thus, we believe that more than the humanitarian aspect, developed countries have the historical, moral, and social responsibility to come to our aid.”

Workers in Region 8 demand employment, people’s participation in Yolanda rehabilitation and reconstruction plan

PRESS RELEASE

30 December 2013

Declaring they won’t beg and live on relief and aid forever, several associations of workers in the informal sector in Region 8 today launched a campaign demanding employment, social protection and people’s participation as bedrocks of Yolanda rehabilitation and reconstruction plan to address not just the immediate but also the long term needs of Pepe and Pilar.

The campaign came days after the government announced the US$8.17-billion or P361-B plan under the so-called Reconstruction Assistance on Yolanda (RAY) which will be completed in four years or by 2017.

Held in Tacloban City, the campaign launch was spearheaded by tricycle and trisikad drivers and operators (TODA’s) in Tacloban, Hilongos and Baybay, in coordination with the labor group Partido ng Manggagawa (PM). 

After attending a twelve noon mass at the Sto. Nino Church, TODA members held a motorcade around Tacloban City with posters bearing the call, “Make jobs a priority in Yolanda rehab”, wrapped around their trikes.  A gathering and small salu-salo followed the motorcade at the Church’s Social Hall where family members and other Yolanda survivors gathered to hear the groups’ manifesto and affirm their commitment to the collective struggle of rebuilding their lives and their communities.

In a joint Manifesto signed by the Tacloban Federation of MCH Drivers and Operators Associations, Inc. (TAFEMDO), the Hilongos-based Trisikad Operators and Drivers Organization (TODO), and Partido ng Manggagawa-Region 8, the groups explained that prior to the onslaught of Yolanda (Haiyan), they already were living poor, miserable lives since transporting people around the city through motorized and non-motorized cabs for hire was their only source of income. 

The Rebolustonaryong Alyansang Makabansa (RAM) in Leyte also signed the manifesto in solidarity with the workers.

“Because income is irregular in this nature of work, we earn less than what we need.  This condition likewise explains why many of us, together with other poor people, live in urban poor communities where we face recurrent and extreme vulnerabilities from both man-made and natural calamities.  In other words, we are poor, defenceless and were unprepared to face the strongest typhoon in history,” read the manifesto.

Jobs as priority

According to Judy Torres, regional coordinator of Partido ng Manggagawa, this was the main reason why they were urging the government and donor agencies to make jobs a priority in Yolanda rehabilitation and reconstruction plans.  

“We want jobs because it is a guarantee to a person’s long-term security and a life of dignity,” said Torres, adding that while everybody was devastated it is the poor that suffered most.

“We want to rebuild our lives.  We want to rebuild our communities.  Hence, in the rehabilitation and rebuilding process, we do not want to just revert back to where we were before Yolanda.  We want a new community – a better community,” added the manifesto.

Torres, who also chairs TAFEMDO, added that aside from providing employment, “the State must also provide victims of Yolanda a broad range of social protection to enable them to live a more secure life in the face of the ‘new normal’ and the worsening climate crisis.”

The workers’ groups also called on the government, both national and local, to put their act together in formulating a new type of rehabilitation and rebuilding plan, saying people at this point in time are not interested in squabbles and personal plans among politicians.

“What you owe us is immediate, climate-resilient, inclusive, and empowering rehabilitation and rebuilding program,” said the groups, stressing further that in the rebuilding process, direct participation by the people is far more important than private consultants and contractors.

International responsibility

The groups likewise urged donor countries and international aid agencies that once the relief and life-saving stage is over, “we enjoin you to help us build a new model community out of the ruins of Yolanda.” 

They further stated: “While we clearly understand that it was Nature’s wrath that made our lives more miserable now, we are also aware that today’s extreme weather systems are the awful outcome of climate change caused by unrestrained economic activities of industrial countries. Thus, we believe that more than the humanitarian aspect, developed countries have the historical, moral, and social responsibility to come to our aid.”

Specific demands

The TODA groups in Tacloban have come up with specific demands addressed to concerned government agencies, international donors, as well as the Church and civic groups.  These include:

§        Jobs for displaced TODA members and for unemployed Taclobanons.

§        Moratorium on payment of fees, specifically the renewal of business permits for FY 2014.

§        Financial assistance for motor/cab repairs or for acquisition of new units.

§        Fuel subsidy for registered TODA members.

§        Mandatory SSS and Philhealth coverage for TODA members through national government or local government sponsorship programs.

§        In-city relocation and climate-resilient socialized housing program for informal settlers.

§        Participation in the rehabilitation and rebuilding process.

Except for some specific items, the same set of demands will be pursued by workers associations in Hilongos and Baybay. 

The groups said they are making this appeal not as mere victims of Yolanda but as Filipino citizens who are entitled to the broadest social protection possible from the State.

“Finally, we believe that everything is possible as long as everyone considers the task of rehabilitation and rebuilding a collective mission and the dream for a new community rising out of Yolanda ruins a common vision,”  concluded the manifesto.

Advisory: Launch of campaign for employment and people’s participation in Yolanda rehab

MEDIA ADVISORY

December 30, 2013

Contact: Judy Torres @ 09262389963; 09482495848

Launch of campaign for employment and people’s participation in Yolanda rehab

WHAT: Mass and motorcade to highlight launch of Yolanda rehab campaign  

WHEN: Today, December 30 (Monday), 12 noon

WHERE: Sto. Nino Church then motorcade around Tacloban City and finally a program at the church social hall

DETAILS: The campaign will demand that employment, social protection and people’s participation be bedrocks of the Yolanda rehabilitation and reconstruction plan in order to address not just the immediate but also the long term needs of Pepe and Pilar.
                The campaign is to be launched by tricycle and trisikad drivers and operators in Tacloban, Hilongos and Baybay, in coordination with the labor group Partido ng Manggagawa (PM).

 The groups will attend a noon mass at the Sto. Nino Church after which they will hold a motorcade around Tacloban City with posters bearing the call, “Make jobs a priority in Yolanda rehab”, wrapped around their trikes.  The motorcade will end at the church for a gathering and small salu-salo at the social hall where family members and other Yolanda survivors will hear the groups’ manifesto.

Labor Yearender: PAL-PALEA settlement to impact on labor relations

Press Statement

December 27, 2013

Undoubtedly the biggest labor story for the year was the settlement of the long-running dispute between Philippine Airlines (PAL) and the Philippine Airlines Employees Association (PALEA). It hardly made it to the news though as the historic deal ran smack of biggest story of the year—supertyphoon Yolanda. At the height of Yolanda and with howling winds buffeting their picketline, PALEA members voted to ratify the agreement.

The settlement provides for the rehiring as regular workers of some 600 PALEA members who were retrenched in 2011 but refused to accept the outsourcing scheme. The process of PALEA members applying for re-employment has started and PAL is mandated to give them priority for hiring in regular positions. The agreement also grants an improved separation package of 200% per year of service and P150,000 in gratuity pay.

The settlement of the labor dispute over outsourcing will have repercussions far beyond the PAL and are highly significant for the challenge presented by precarious work to workers, employers and the state.

The victorious resistance of PALEA against contractualization and the vigorous campaign it has engendered puts into question the popular view that precarious work is a global trend that cannot be rolled back. In fact just weeks after the PAL-PALEA agreement was signed, 500 contractual mining workers in Cebu won regularization after mass actions by the union PAMCC. The PAMCC union in the Toledo City-based Carmen Copper Corp., one of the biggest mines in the country, was active in the PALEA solidarity campaign in Cebu and was directly inspired by the outcome of the PAL dispute.

Indeed well before the settlement was signed and just two months after the implementation of the outsourcing plan, the dispute already changed the landscape of industrial relations. In November 2011, the Department of Labor and Employment issued DO 18-A to spell out new regulations over contracting and subcontracting arrangements arguably in the face of an outcry from organized labor about the retrenchment of 2,400 workers at PAL.

Arguably resistance saved PALEA’s regular jobs. If they had accepted rather than fought outsourcing then they would have become contractual workers trapped in an endless cycle of 6-month endo jobs. Or worse they would have become unemployed in a jobless growth economy. Instead some 600 PALEA members will be returning to their regular jobs in the coming weeks.

Labor groups, both in the country and abroad, have hailed PALEA’s victory as a victory for all workers. Meanwhile PALEA has expressed its gratitude for the fervent solidarity of workers, community and Church groups which launched protests, lobbying and a boycott campaign. While difficult to assess, the boycott contributed to PAL’s P2.19 billion in losses due to reduced passenger revenues just for the first half of its latest fiscal year.

PALEA’s campaign combined old school tactics of struggle and modern means of organizing solidarity. PALEA’s fight struck a sympathetic chord in the international labor movement and thus two global days of actions involved protests in airports and embassies across four continents. PALEA members used Facebook to maintain contact, exchange ideas, call for action and solicit support. PALEA was a trending topic on Twitter in the immediate aftermath of the airport protest as allies and critics debated in cyberspace, and again during the impeachment trial of the Supreme Court Chief Justice when it was exposed that he received “platinum cards” as gift from PAL.

The coming year will see how far the outcome of PAL-PALEA labor dispute can reverberate outside industrial relations at the flag carrier.

If Petilla can offer his head, why can’t Ducut and Ocampo do the same?

Press Statement

December 26, 2013

NAGKAISA!

The news of Department of Energy (DoE) Secretary Jericho Petilla tendering his resignation in the wake of failure to meet his self-imposed deadline in bringing back electricity to areas ravaged by typhoon Yolanda is all over the air.  Whether the President will accept his resignation or not can be part of a ploy. But nevertheless, Petilla had the guts to place his head on the chopping board.

We wonder, however, if other inept officials in the energy family – particularly Energy Regulatory Commission (ERC) Chairperson Zenaida Ducut and Philippine Electricity Market Corporation (PEMC) head Mel Ocampo can do the same.

Petilla who heads the DoE is equally responsible for the government’s failure to stop the P4.15/kWh rate increase imposed by Meralco.  But Ducut and Ocampo who are in the frontline and supposed to be the first persons to detect market failure and protect consumers' welfare stood idle before the coming tsunami of power hikes. They therefore should go.  

Truth is, throughout their tenures, they have consistently failed to discharge their duties of regulating the power industry properly. The latest fiasco is just the culmination of years of ineptitude and incompetence.

As early as 2012, they were aware of scheduled maintenance shutdown and yet they did nothing to prevent the largest market failure in the power sector to date. In the process they unduly enriched Independent Power Producers (IPPs) to the tune of 10 billion pesos for a month’s worth of power outages!

They should go based on the principle of command responsibility. At the least, they allowed the electricity market to be gamed, and at the most, they are a party to the reported collusion among power firms.

                                     

Ducut and Ocampo should be investigated for possible charges of economic sabotage.

It’s also the time for the regime of Electric Power Industry Reform Act (EPIRA) to go.

Militants slam Serge Osmena for “no collusion” statement

Press Release

December 19, 2013

The militant Partido ng Manggagawa (PM) today slammed Sen. Serge Osmena for pre-empting the probes by the Department of Energy (DOE) and the Department of Justice (DOJ) of the huge power rate hike with his statement yesterday that there is no collusion among generation companies and Meralco. The two departments are precisely looking into allegations of collusion.

“Serge is a consistent supporter of power industry players since his sponsorship of the EPIRA Law which ushered in the era of high electricity rates to his defense of Meralco’s gargantuan rate hike,” opined Wilson Fortaleza, PM spokesperson.

Fortaleza is one of the signatories to the complaint against Meralco and generation companies lodged by groups last Monday with the DOJ Office for Competition. DOJ Secretary Leila de Lima pledged to come up with a finding by January next year.

Meanwhile PM continued its campaign of picketing Meralco branches. Yesterday its Cavite chapter protested at the Meralco branch and depot in Dasmarinas City. Tomorrow, PM members will picket the Meralco branch in Marilao, Bulacan. Last Monday PM staged a coordinated picket of branches in Paranaque, Rizal and Cavite.

“Serge’s statement is a mere opinion and not even a conclusion after an investigation. At the Senate hearing, even as senators grilled officials of the Energy Regulatory Commission and the DOE, they handled with kid gloves representatives of Meralco and the generation companies. As to why, it may be necessary to look into election campaign contributions by power industry players,” Fortaleza averred.

PM asserts that the Meralco price increase is unconscionable since it is an act of economic terror amid calamities, inequality and poverty in the country. Fortaleza argued that “It is also unfair. Workers in NCR were only granted P10 per day or P260 per month under Wage Order No. 18. The P4.15/kwh total increase in Meralco’s rate is an additional P830 burden for households consuming 200 kwh per month.”

“The worker-led consumer campaign against collusion by Meralco and the generation companies to drive electricity prices will continue and intensify next year. Consumers anger will boil over when they get their next electricity bills,” Fortaleza predicted.

Protests vs. Meralco rate hike spreads outside Manila as coordinated picketing staged

Press Release

December 16, 2013

The militant Partido ng Manggagawa (PM) staged a coordinated picketing of Meralco branches as protests against the huge power rate hike intensified at the grassroots level and spread outside Metro Manila. Meralco branches in Paranaque, Rizal and Cavite were picketed this morning and afternoon by several hundred workers and urban poor.

Also today, the PM spokesperson together with leaders of other groups formally asked for an anti-competition inquiry on Meralco’s rate hike. The request was filed with the Office for Competition which is under the DOJ and was created by E.O. 45 series of 2011.

“If competition exists in the power industry then business interests would collide but under EPIRA, the players collude,” stressed Wilson Fortaleza, PM spokesperson, as he joined the filing of the request for inquiry on unfair competition against Meralco and generation companies.

He added that “It is futile to pursue an honest scrutiny of Meralco’s huge rate hike through the ERC which is totally captured by monopolists in the power industry. Instead we hope the Office from Competition can give a fair hearing to the complaint. If PNoy is serious about investigating Meralco’s hike, then he can do something through the Office for Competition which is under his authority, unlike the ERC.”

At 10:00 am today, PM members trooped to the Meralco branch in Tambo, Paranaque and Antipolo City in Rizal. Later at 3:00 pm, other PM members in Cavite picketed branches in the towns of Rosario and Dasmarinas.

In the next few days, PM will continue the series of protests with pickets in Marilao, Bulacan and GMA, Cavite.

Advisory: Filing of anti-competition inquiry; coordinated picketing of Meralco branches

Media Advisory
December 16, 2013

Groups to ask for anti-competition inquiry

as pickets to be held in outlying Meralco braches

WHAT: Picket-protests and request for anti-competition inquiry vs. Meralco and generation companies

WHEN: Today, December 16, 11:00 am

WHERE: Department of Justice (DOJ), Faura, Manila

DETAILS: Members of the Partido ng Manggagawa will have a picket-protest today at the DOJ as their leaders together with other groups and personalities formally ask for an anti-competition inquiry on Meralco’s rate hike. The request will be filed with the Office for Competition which is under the DOJ and was created by E.O. 45 series of 2011.

Also today, the protests vs. Meralco’s fare hike goes to the grassroots and expands outside Metro Manila with a coordinated picketing of Meralco branches:

10:00 am, Tambo, Paranaque and Antipolo, Rizal

3:00 pm, towns of Rosario and Dasmarinas in Cavite

“It is futile to pursue an honest scrutiny of Meralco’s huge rate hike through the ERC which is totally captured by monopolists in the power industry. Instead we hope the Office from Competition can give a fair hearing to the complaint. If Pnoy is serious about investigating Meralco’s hike, then he can do something through the Office for Competition which is under his authority, unlike the ERC,” according to Wilson Fortaleza.

Advisory: Anti-competition inquiry vs Meralco; coordinated picketing of Meralco branches

Groups to ask for anti-competition inquiry

as pickets to be held in outlying Meralco braches

WHAT: Picket-protests and request for anti-competition inquiry vs. Meralco

WHEN: Tomorrow, December 16, 11:00 am

WHERE: Department of Justice (DOJ), Faura, Manila

DETAILS: Members of the Partido ng Manggagawa will have a picket-protest tomorrow at the DOJ as their leaders together with other groups and personalities formally ask for an anti-competition inquiry on Meralco’s rate hike. The request will be filed with the Office for Competition which is under the DOJ and was created by E.O. 45 series of 2011.

Also tomorrow the protests vs. Meralco’s fare hike goes to the grassroots and expands outside Metro Manila with a coordinated picketing of branches in Paranaque, Rizal and Cavite. Between 10:00 am and 11:00 am tomorrow, workers and poor will picket Meralco branches in Tambo, Paranaque; Antipolo, Rizal; and the towns of Rosario and Dasmarinas in Cavite.

“It is futile to pursue an honest scrutiny of Meralco’s huge rate hike thorugh the ERC which is totally captured by monopolists in the power industry. Instead we hope the Office from Competition can give a fair hearing to the complaint. If Pnoy is serious about investigating Meralco’s hike, then he can do something through the Office for Competition which is under his authority, unlike the ERC,” according to Wilson Fortaleza.

MRT/LRT rate hike unfair and unjust – labor group

PRESS RELEASE

12 December 2013

The Partido ng Manggagawa (PM) renewed its call for the government to forego its plan to raise the tariff rates in the MRT and LRT systems by additional P10 during a public consultations held today.

PM spokesperson Wilson Fortaleza, said that while workers are very much interested in making their daily train travel safer and more comfortable through improved services, removing the state subsidy to millions of commuters through a fare hike further deepens the inequality and poverty in this country, notwithstanding the failure of the government to bare the real score justifying the increase.

He likewise complained that the public hearing today can never be intelligent and participatory since none of the documents that they were asking from DOTC since August this year were provided before its conduct.

Nevertheless, PM participated in the hearing to make its opposition official while several of its members holding “Palag sa P10 dagdag!” placards held a picket outside the LRT 2 depo in Pasig City where the consultation is being held.

In the consultation, PM had raised the following grounds to back their opposition to the planned P10 fare hike:

1.       The real amount of subsidy to MRT-LRT consumers (P45 for MRT and 25 for LRT) as presented by President Aquino during his State of the Nation Address this year was erroneous as he compared the cost of subsidy to the rates of air-conditioned buses in Edsa. The group’s own estimate puts the figure to just P13 per passenger ride.

2.     It is highly unfair and unequal to remove the annual P6-B subsidy to some 400 million train riders while providing the few VIP’s in government with at least P8-B travel subsidy, including the P1-M per day travel subsidy to the President and P180,000 to the DOTC secretary. PM asserts that subsidy is a necessary social tool amid inequality and poverty in the country.

3.     Ordinary workers will be mostly affected by the fare hike.  Based on the 2007 Mega Manila Public Transport Study, 67.7% MRT and LRT users earn less the P10,000 per month or less than the mandated minimum wage while another 15%, most probably students, are ‘without income’ in their economic profile.

4.   Costs borne out of onerous contracts, corporate fraud, or flawed executive decisions should not be passed on to consumers. The government should rather conduct an honest-to-goodness inquiry into allegations that the private consortium MRTC and other parties have defrauded the government and the people under the onerous BLT contract.  If such is proven, PM demands that the BLT contract rescinded at no further cost to the government.  Any liabilities accrued from such onerous or fraudulent transactions must be shared by the contracting parties and not passed on to commuters.

5.  The fare hike is a prelude to privatization.  PM maintains its position that vital public utilities such as the MRT/LRT system remain in the public sphere.

The group argued that privatization is neither the tuwid na daan, nor the way towards inclusive growth. 

“The country has had enough of devastating privatization experience in vital industries such as power and water.  With the latest hike in Meralco rates of P4.15/kwh, we can now pride ourselves as a third world country with power rates that of the first world,” concluded Fortaleza.

Advisory: Workers to picket LRT/MRT fare hike hearing

WHAT: Picket protest vs. proposed LRT/MRT fare hike

WHEN: Today, December 12, 1:30 pm

WHERE: LRT 2 Santolan, Pasig station/depot

DETAILS: Members of the Partido ng Manggagawa will have a picket-protest while their representatives will present a critique of the proposed LRT/MRT fare hike. The LRT/MRT fare hike hearing is schedule tomorrow at 2:00 pm. In its presentation, PM will assert that the fare hike is unjust and unnecessary.

P4.15/kWh power hike is bonus for doing nothing – labor group

PRESS RELEASE

09 December 2013

Just for doing nothing, Meralco and several generation companies (Gencos) were rewarded a whooping bonus of P4.15/kWh, the labor group Partido ng Manggagawa (PM) said in a statement.

 

According to PM, the impending increase, the highest in the country’s history and in the world, could have been avoided had Meralco and gencos planned for replacement power to address the expected load gap from Malampaya’s scheduled regular maintenance.

 

“But in a privatized industry regime under EPIRA, power utilities earn handsome profit just by doing nothing and even during times of calamities. Power utilities like Meralco control the whole industry from generation to transmission to distribution and can thus exercise monopoly pricing limited only by what the market can absorb, meaning what the consumers are willing to pay in exorbitant electricity costs,” said PM spokesman Wilson Fortaleza.

 

About 2,700 MW of power from Sta. Rita, San Lorenzo, and Ilijan plants were lost due to the shutdown of Malampaya. Luzon needs at least 6,000 MW to meet its peak load demand.

 

“Imagine a deficit of 2,700 megawatt, an anticipated crisis, yet Meralco and Gencos did nothing but wait for the billing period and impose their new and adjusted rates,” lamented Fortaleza.

 

The group, which joined the Freedom from Debt Coalition and Nagkaisa in a picket held at the ERC this morning, added that the crisis is made worse when the government, particularly the Department of Energy (DoE) and the Energy Regulatory Commission (ERC), “stood idle in the face of the surging tsunami of price hikes in the electricity market.”  The government should have disallowed other power plants to shutdown simultaneously with Malampaya to ensure stability of supply in the Luzon grid.

 

Fortaleza explained that replacement power is a global template for every power supply contract since outages, both regular and forced, is routine in the power system. In many PSA’s the obligation to find replacement power or plan for alternative set up belongs to Gencos since they have contracts to comply in ensuring reliable supply of power to their customers. 

 

Unfortunately, said Fortaleza, most of ERC-approved PSAs assigned replacement power to Meralco and the Wholesale Electricity Spot Market (WESM), where spot prices which as of yesterday range from P17/kWh to P52/kWh.

 

Fortaleza added that Gencos have options to avoid the instability and he cited the case of Sta. Rita and San Lorenzo.  Based on First Gen’s submission to the Philippine Stocks Exchange (PSE) on March 20, 2012, it explained that,“Although the Sta. Rita plant is intended to operate on natural gas, if delivery of natural gas is delayed or interrupted for any reason, the plant has the ability to run on liquid fuel for as long as necessary without adverse impact to its operation or revenues.” The same business model goes with San Lorenzo.

 

Now did Gencos, Meralco, and the government considered this option?

 

“No, they just did nothing,” concluded Fortaleza.

Highest power rate hike not acceptable, unjust

Press Release

December 7, 2013

The Partido ng Manggagawa, a member of labor coalition Nagkaisa, rejects the impending power rate hike of P4.15/kwh in the Meralco area based on the following grounds:

1.    This is unconscionable, an act of economic terror amid calamities, deepening inequality and poverty in the country.

2.    This is unjust.  When imposed, the P4.15 rate adjustment will be the highest in Philippine history.  This will also be the highest residential rate in the world.

3.    This is unfair.  Workers in NCR were only granted P10 per day or P260 per month under Wage Order No. 18.  The P4.15/kwh increase in Meralco rate is additional P830 burden for households consuming 200 kwh per month.

4.    The rate hike, on the contrary, cannot be imposed arbitrarily by Meralco as explained earlier by Malacanang.  Meralco has to secure the approval of the Energy Regulatory Commission (ERC).

5.    The steep hike could have been prevented.  The Malampaya shutdown is not due to force majeure.  It is part of regular biannual maintenance therefore expected and has already been factored in in Meralco’s power supply agreements (PSA) with its suppliers, particularly First Gas’ Sta. Rita and San Lorenzo and Kepco Ilijan.  The PSA should have included provisions on “replacement power”.

Based on First Gen’s submission to the Philippine Stocks Exchange (PSE) on March 20, 2012, it was explained that,“Although the Sta. Rita plant is intended to operate on natural gas, if delivery of natural gas is delayed or interrupted for any reason, the plant has the ability to run on liquid fuel for as long as necessary without adverse impact to its operation or revenues.” The same business model goes with San Lorenzo.

6.    This is market failure.   Collusion among generation companies, which has been the name of the game under EPIRA, is most possible after the Malampaya shutdown to drive prices at the Wholesale Electricity Spot Market (WESM) up.

7.    This is failure in governance.  The government, particularly the Department of Energy, should not have allowed this artificial shortage as a result of simultaneous shutdowns of power plants following the shutdown of Malampaya. 

Inihahalintulad namin ang delubyong ito bilang panibagong kalamidad dala ng kasakiman ng mga kumpanya ng kuryente na walang pinipiling panahon para gawin ang kanilang pandaramobong, at sa gubyerno na sa lahat ng panahon ay natutulog sa pansitan.

Predatory MERALCO price hike slammed by NAGKAISA

Press Release

December 6, 2013

Nagkaisa

Meralco already insured against maintenance shutdowns, Power Supply Agreements cover Meralco risk with power providers

The NAGKAISA labor coalition denounced the December P3.50 per kWh rate increase as an immoral imposition and an unconscionable predatory move in the face of our massive national suffering and despair. Instead of moderating its greed, MERALCO and the generating companies First Gas (Sta. Rita), South Premier Power Corporation (Ilijan) and Therma Mobile, Inc. (San Lorenzo) – which are its cohorts – chose to further impoverish hardworking Filipinos and complicate the already difficult road to national recovery.

MERALCO residential rates currently pegged at Php12.46 per kWh will now be hiked to Php15.96 per kWh, representing a 28% increase. The new rate is equivalent to US$ 37 cents per kWh. That is the highest residential rate, bar none, in the WORLD. Its consequences for families coping with the triple whammy of NAPOLES-scale corruption, spiralling oil and LPG prices, and natural calamities are immense.

For industry, where power rates already constitute 45% to 55% of operational costs, particularly for Small and Medium Enterprises (SMEs) and BPOs, the rate increase will greatly affect their business viability. For the national economy, it compromises our regional competitiveness in the ASEAN and will be a disincentive to locators remaining and to the entry of foreign direct investments.

NAGKAISA pointed out that before a new tariff formula called Performance-Based Rate-making (PBR) was implemented by the Energy Regulatory Commission (ERC), MERALCO only made an annual net profit ranging from Php3 to Php6 billion. Under PBR in 2012, MERALCO declared a net income of Php16.25 billion. For 2013 MERALCO expects a consolidated net income of Php17 billion. NAGKAISA decried this overly-generous rate of return allowed by ERC which allowed MERALCO to earn in just one year what it used to take them 3 years to earn.

NAGKAISA also countered the MERALCO assertion that the maintenance work on Malampaya and resorting to the more expensive sources of WESM would result in a power rate increase of anywhere from Php2 per kWh to Php3.50 per kWh. NAGKAISA argues the following:

·       The scheduled maintenance of Malampaya and other plants should or was already imputed in the MERALCO rate. If MERALCO management did not prudently build this into their rate then the owners and management of MERALCO should bear the loss, not the consumers. The maintenance was scheduled way ahead of time and the cost consequences should already have been placed in the power supply agreements which MERALCO entered into.

·       If there is a forced outage, MERALCO and the power producers First Gas (Santa Rita), Therma Mobile (San Lorenzo) and SPPC (Ilijan) from which MERALCO buys its power are insured against possible spikes in costs. Why is MERALCO passing the burden to consumers when there is insurance for forced outages. Again, if MERALCO did not enter into any form of insurance or contract stipulation as to who will pay for the alternative supply in case of an outage (the alternative supply in this case is WESM), then MERALCO again has acted imprudently and should bear the cost of its imprudence.

·       MALAMPAYA is providing only a certain percentage of the power needs of MERALCO. Why are the entire costs of the downtime of Malampaya being borne by MERALCO consumers? How did it amount to a possible P3.50 per kWh increase?

·       Why has the ERC as regulator not stepped-in to validate the current claims of MERALCO when there are Commission on Audit findings of overcollection in 2004 and 2007 in the generation charges of MERALCO? Does ERC take the manifestations of MERALCO and the generation players as gospel truth?

·       Why has the DOE – or the Palace for that matter – not addressed the possibility of resorting to the MALAMPAYA FUND to reduce rates and to cushion the impact if indeed there is a problem not anticipated in the power supply contracts entered into between MERALCO and the generators?

THE TRUTH OF THE MATTER IS THAT CONSUMERS ARE BEING MADE TO ADVANCE WHAT THE MERALCO WILL BE COLLECTING FROM ITS INSURERS EVENTUALLY. When MERALCO entered into its supply contracts, it inputted and covered against all projected events and the cost consequences. These costs were built into the original power supply agreement and are therefore built into the rate. Further, MERALCO insured against all risks. MERALCO IS TRYING TO COLLECT FROM ITS CUSTOMERS BECAUSE IT THINKS IT CAN FOOL THEM. ENOUGH IS ENOUGH.

NAGKAISA has warned that the Wholesale Electricity Supply Market (WESM) does not and cannot work where you have insufficient supply. Given inadequate power supply, there will be no competition to drive down rates because it will be a sellers market. NAGKAISA, as a disinterested party, had already warned the government of this in its meetings with the economic cluster of the Cabinet in April and May 2013. NAGKAISA notes that notwithstanding the notable failure of WESM to bring down electricity prices in Luzon and Visayas, the DOE is currently piloting it in Mindanao where power supply is also inadequate.

NAGKAISA warns that the general public are beginning to realize that the Palace is a defender of MERALCO by its statements that there is “regularity” to the rate increase because it was “in accordance with the law.” NAGKAISA reminds the Palace that it is not for the NAGKAISA or the Palace nor the DOE to determine regularity. That is a function that clearly lies with the ERC. It is the ERC which must determine the course of action to be taken: to set the increase aside or to cushion its impact through rate increases staggered over a longer period of time.

NAGKAISA also reminds the Palace that perhaps something is deadly wrong with the EPIRA Law and that it is time to take a second hard look on how to ensure affordable power and supply that is reliable. We reiterate our call for the creation of a Presidential Task Force to bring down power rates. The Palace should talk to disinterested parties – not the power cartel.

Finally, NAGKAISA reminds the Palace that if in its fight against corruption, it brought down an Ombudsman and a Chief Justice, it can certainly do something about a certain ERC Chairperson named Ducut. Consumer and labor representation in the ERC is long overdue.