A SENIOR House leader has joined the Philippine Association of Independent Power Producers (Pippa) in its demand to strip the National Power Corp. (Napocor) the right to procure coal and oil under the proposed measure to amend the Electric Power Industry Reform Act (Epira).

Nationalist People’s Coalition Rep. Arnulfo Fuentebella of Camarines Sur, a member of the Joint Congressional Power Committee (JCPC) and principal author of Epira, said it would be more prudent to transfer the procurement of the IPP’s fuel to IPP administrators because of “fuel problems encountered in some power plants when they are being operated by Napocor.”

Fuentebella said the transfer of fuel-procurement function to the IPPAs would enable the IPPs to meet their contractual obligations or supply agreements they would enter into, a concern which has been raised by industry players.

Stakeholders in the power sector want the fuel-procurement function of Napocor over IPPs transferred to Pippa.

They said this would also eliminate persistent allegations of graft and corruption in the procurement of coal.

Citing Section 47 of Epira, Pippa, in a position paper submitted to the House, said allowing Napocor to retail fuel procurement while obligating IPPAs to market the energy output under NPC-IPP contracts “will be counterproductive and reduce privatization proceeds of the government.”

It said proposed House Bill 1889, which seeks to amend Epira, must be revised so that privatization would become “capacity-and-energy available under its [Napocor] IPP contracts.”

The proposed amendment also noted that the obligation that will be assumed by the IPPA upon privatization is limited to the obligation to sell the energy output under the IPP contract concerned.

“By implication, the procurement of fuel under the IPP contract would remain with Napocor. This situation would not be advisable,” the group said.

“Epira intends to fully privatize Napocor and does not contemplate Napocor having a residual function or existence as a fuel-procurement company. The bidders to the Ippa administration privatization would consider carcing out the fuel-procurement function in favor of Napocor as a diminution in the value of the IPP contract. The winning bidder would assume a significant higher risk in selling the energy output when it has no control over the fuel used...higher risk translates to lower privatization value,” it added.

Ernesto Pantangco, Pippa president, said the Department of Energy and the JCPC could decide in removing Napocor’s fuel-procurement function.

Recalling the recent charges against Napocor officials, Pantangco said allowing Napocor to still administer the procurement of coal would still be a problem.

He said that even “as you privatized it, this could be one source of corruption.”

Early this year Napocor was asked to explain its procurement following the high price of electricity traded in the spot market during the summer months and the power outages that hit Metro Manila as a result of lack of fuel supply.

The Power Sector Assets and Liabilities Management Corp. (Psalm) is set to auction Napocor’s IPP contracts to the IPPAs early next year.

Psalm was authorized and mandated to take title to and possession of the Napocor IPP contracts and to appoint, after public bidding, qualified independent entities who shall act as IPPAs.

Settlers get 300 housing units from Hanjin

SUBIC BAY FREEPORT—Amid the controversy over the construction by Hanjin Heavy Industries Corp. (HHIC-Phil) of an apartment complex, the South Korean investor silently turned over some 300 housing units to families affected by its shipyard-expansion program at the Redondo Peninsula here.

OPPOSING Malacañang’s call to the House of Representatives to review the baselines bill, a proadministration legislator dared his colleagues to “do what is right and put the Kalayaan Island Group inside the country’s baseline.”

A SENIOR House leader has joined the Philippine Association of Independent Power Producers (Pippa) in its demand to strip the National Power Corp. (Napocor) the right to procure coal and oil under the proposed measure to amend the Electric Power Industry Reform Act (Epira).

THE Armed Forces chief of staff, Gen. Hermogenes Esperon Jr., is trying to strike a bargain with some of the 28 military officers accused of mutiny over still unknown reasons, a defense lawyer said on Thursday.

THE ongoing drive of the Metropolitan Manila Development Authority (MMDA) to reduce the number of buses plying Epifanio de los Santos Avenue (Edsa) by going after colorum and out-of-line buses is doomed to fail, unless government agencies involved in the franchising, regulation and registration of the public-utility vehicles get their act together.

CITY OF MALOLOS—Here’s good news to public servants who are willing to give their best to improve the lives of their constituents.

ENVIRONMENT Secretary Lito Atienza is confident that the Investment Defense Force (IDF) that Malacañang has activated will address security concerns being raised by both local and foreign mining investors following recent attacks in some of the mining projects in the Philippines.

WITH an expected influx of about 12 million passengers this year, the Manila International Airport Authority (Miaa) has accepted a donation of 1,500 baggage trolleys and 12 “jumbo” carts to add to an existing 1,500, hoping that this would be enough to prevent the shortage of pushcarts during peak arrivals and departures.