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Power supply deals’ rebidding to benefit consumers
“SC’s decision will mandate greater transparency in the contracting of power supply in the future since the High Tribunal mandates that power supply agreement (PSA) should undergo competitive selection process (CSP) instead of directly negotiated deals, which could be burdensome to many Filipinos,” Gatchalian said in a statement. (Shutterstock Photo)
MANILA — Senator Sherwin Gatchalian on Tuesday lauded the Supreme Court decision ordering the bidding of all power supply agreements (PSAs) submitted by distribution utilities (DUs) from June 30, 2015 as a win for all power consumers.
Gatchalian, chair of the Senate committee on energy, said the High Court’s order would mandate “greater transparency” in the industry and dispel the public’s distrust over sweetheart deals between DUs and generating companies.
“SC’s decision will mandate greater transparency in the contracting of power supply in the future since the High Tribunal mandates that power supply agreement (PSA) should undergo competitive selection process (CSP) instead of directly negotiated deals, which could be burdensome to many Filipinos,” Gatchalian said in a statement.
Gatchalian cited data from the Energy Regulatory Commission (ERC) showing that there are 93 PSAs filed from March 23, 2016 to April 29, 2016, with terms reportedly spanning more than 20 years, which were not bid out but were instead bilaterally contracted.
Of the 93, seven PSAs of Meralco — with a total capacity of 3,550 megawatts out of the 4,600 MW –were deemed questionable.
In granting the petition filed by Alyansa Para Sa Bagong Pilipinas Inc., the Court en banc held that the ERC committed grave abuse of discretion amounting to lack or excess of jurisdiction when it unilaterally postponed the effectivity of the CSP requirement by issuing ERC Resolution No.
13 and ERC Resolution No. 1.
Sought for comment, the office of former ERC chair Jose Vicente Salazar, now a private lawyer, said as a collegial body, he was outvoted by four other commissioners who wanted the bidding system put off, contrary to his position that the CSP system be implemented.
The Court pointed out that the authority of the ERC was limited only to the implementation of the CSP, and that the ERC had no power and authority to postpone the CSP’s application.
