Arroyo to meet Meralco chairBy Michael Lim Ubac, Ronnel Domingo, Nancy C. Carvajal
Philippine Daily Inquirer
First Posted 00:32:00 05/18/2008
PRESIDENT MACAPAGAL-ARROYO IS WILLING TO MEET with Manuel Lopez, the Manila Electric Co.’s chair and CEO, amid an increasingly acrimonious media war between the power distribution utility and administration allies in and out of Congress.
But only if the talks will revolve around lowering power rates, said Deputy Presidential Spokesperson Anthony Golez as reports emerged yesterday that a meeting between the President and Lopez had in fact been set for Tuesday on the resort island of Panglao in Bohol.
The President is scheduled to preside over a Cabinet meeting either in Panglao or nearby Balicasag island on that day, according to Press Undersecretary Jose Capadocia.
According to reports, a meeting between the President and Lopez and Meralco president Jesus Francisco came up following the airing of an interview over the Lopez-owned ABS-CBN television network the other day in which Lopez said he had no quarrel with Ms Arroyo, and would like to meet with her to discuss electricity rates and explain Meralco’s side in the issue.
A highly placed source, who asked not to be named, said Lopez and Francisco will be in Bohol on Tuesday and that “the President had granted their request for an audience.â€
“Indeed there is a meeting and the Lopezes are meeting with the President. They are expected to ask for the head of GSIS president Winston Garcia because he is Meralco’s pain in the a--,†the source said.
Secretary Cerge Remonde, the head of the Presidential Management Staff who is rumored to be the likely replacement for outgoing Press Secretary Ignacio Bunye, would not confirm the meeting with Lopez but said energy was one of the items on the agenda of the Cabinet meeting.
“Energy is one of the governance themes of the month. Hence, energy is one of the agenda. Whether Lopez is attending or not is something I can neither confirm nor deny,†said Remonde.
The audience with Ms Arroyo comes with a price.
“The meeting will be in exchange for ABS-CBN’s cooperation,†said the source, pointing out that it is an open secret that the Lopez-owned TV network has been critical of the President.
Garcia, whose state pension fund that he heads holds four seats in the 11-man Meralco board, has been waging a media war against Meralco, accusing it of shady corporate and financial dealings. He said he would seek a change in management in the company and was quite ready to buy out the Lopezes.
Consumer groups and administration allies in Congress swiftly got into the act with the Senate and the House holding a joint inquiry in the midst of Garcia’s media offensive. The congressional hearings have initially focused on the reasons for Meralco’s high rates, bringing up the issue of Meralco’s “self-dealing†with Lopez-owned suppliers and the utility’s passing on systems loss charges to its customers.
The government holds a 33-percent stake in Meralco, of which 23 percent is owned by the GSIS. The Lopez family controls about 33.4 percent.
Golez said if the objective of the meeting with the President that the Lopezes are seeking is to discuss the GSIS-Meralco issue, “as we have said from the very beginning, that matter is between the GSIS and the Meralco.â€
He said Ms Arroyo would not interfere in the management change in Meralco being sought by the GSIS.
“But if the objective is to talk about lowering the rates, then the President is very much welcome to talk,†said Golez.
“That’s the number one objective of the President,†he said.
Sought for comment on the rumored meeting in Bohol, Elpi Cuna, Meralco’s corporate communications director, said Lopez could not be located.
“He is probably resting. As you know, he has cancer. Mr. Lopez might be able to issue a statement when he returns to work on Monday,†Cuna said.
Cuna said Lopez had mentioned a possible meeting with the President because the Meralco chair believes Ms Arroyo was being misinformed about Meralco and that he wanted to explain.
Meralco officials on Saturday said the company was studying a system of pre-paid electricity to address the problems of pilferage, which adds to the systems charge in consumers’ monthly electricity bills.
A pre-paid electricity meter system will use the same concept as pre-paid cellular phones and phone cards where consumers pay in advance for their consumption, Meralco treasurer Rafael Andrada told reporters at a Quezon City press forum.
“Everything is being studied thoroughly as one of our concerns is that it would be labeled antipoor because you have to pay first before you can use [electricity], unlike now that it would be used first before collection,†he said.
Meralco also wants to ensure that the meters would be tamper-free, said Ivanna de la Peña, the vice president for utility economics.
De la Peña said the prepaid meter system has been successfully implemented in South Africa and China and the United States though it is not in popular use in those countries.
“We are considering it because it’s also viewed as a solution to collection problem and delinquency,†she said.
Cuna, who was also at the forum, said that despite the controversies that Meralco is facing now, the company’s annual stockholder meeting on May 27 would be no different from last year.
“It will be business as usual and agenda would just be exactly like last year, including the election of the directors,†he said.
Andrada expressed confidence that the present Meralco management would prevail despite the questions raised about its capability and moral authority to manage the utility.
“A lot of things could happen during the stockholders meeting but at the end of the day, the management stands by its record and its commitment to continue providing service,†he said.
Cuna said no major announcement would be made at the meeting.
“It will be exactly like last year, the same agenda, the annual report, report of the company president and the election of the directors,†he stressed.
Francisco, the Meralco president, meanwhile said consumer groups should support congressional initiatives to stop levying the value-added tax on Meralco’s systems loss charge instead of engaging in disparate efforts to address the issue.
Francisco, who is also Meralco’s chief operating officer, said the National Power Corp. was already taking steps to bring down generation charges.
At a hearing last Monday of the Joint Congressional Power Commission, Del Callar said Napocor’s rates would be expected to go down by 35 centavos per kilowatt-hour with the onset of the rainy season.
This is because rising water levels in reservoirs brought on by the rains will mean that hydro-electric power plants would be operating at higher generating capacities.
The Bagong Alyansang Makabayan and People Opposed to Warrantless Electricity Rates (Power) said consumers cannot leave everything to Congress.
“Congress can’t do it alone, it needs a push from consumers. Sometimes, lawmakers need some guidance on how to approach an issue,†said Bayan secretary general Renato Reyes.
He said Bayan and Power would file petitions with the Bureau of Internal Revenue to remove the VAT on systems losses and to seek a refund from Meralco for what consumers paid in systems loss charges in the past two years, estimated at P4 billion.
Reyes called on customers of other distribution utilities nationwide to also start making their computations on how much VAT was levied on systems losses, which he should should also be refunded.
Several nongovernment organizations on Saturday said they would file a class action suit against Meralco in the next two weeks.
Around 30 NGOs, grouped under the Refund Energy Fees Unjustly Debited (Refund Movement), demanded a respite from what they said were “unjustly imposed and oppressively collected electric rates.â€
Dante Jimenez, chair of the Volunteers against Crime and Corruption, said Refund will not only file a civil suit, it will also charge Meralco with large-scale estafa for overcharging consumers and for the slow release of the P30 billion in refunds ordered by the Supreme Court.
In a manifesto read Saturday, Refund members urged a full accounting of Meralco’s charges and an immediate refund of the “unjust†charges.
“Just for the first quarter of 2008, Meralco gained a net profit of P655 million. Yet, Meralco makes all their consuming public pay for Meralco offices’ unlimited consumption of electricity amounting to hundreds of millions of pesos. Meralco keeps the profits and makes us pay for its losses,†Refund said.
The group also denounced Napocor for its “continued inefficiency and dubious loans and contracts,†and the Energy Regulatory Commission for failing to protect consumers from Meralco.
But it opposed a government takeover of Meralco, saying the key to a well-governed Meralco is to have significant consumer representation in it.
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