Consumer group People for People Coalition decried the “clear hostage scenario” that SMC Global Power Holdings Corporation is painting by threatening to terminate its power supply agreements with Manila Electric Company if the power regulator fails to grant its pending petition for a power rate hike to offset losses.
“SMCGP reeks of desperation to pass on their losses to consumers and even had this ridiculous plea to the Energy Regulatory Commission for a fair and objective hearing even after posting P17.9 billion net income from last year up to the first quarter of 2022,” said Gerry Arances, P4P Convenor, on Friday.
“Everyone knew in 2019 that the Malampaya gas fields would soon dry up, that in choosing fossil fuels, SMC is betting that the volatility of the world market would favor them. SMC earned billions but we did not see them petitioning the ERC to lower rates.
That’s the nature of a business — sometimes you win, sometimes you lose. If the SMC wanted stability in prices, they should have instead invested in renewable energy, which is also environmentally friendly and cheaper for consumers,” Arances said.
SMCGP filed to increase the rates they charge on electricity in view of the P15 billion losses incurred by the latter in the operations of its 1,200-megawatt Sual plant and the 1,200-megawatt Ilijan power plant amid the restrictions on supply from Malampaya and the high cost of gas in the world market.
This week, the company warned consumers in Metro Manila and nearby provinces to expect electricity prices to go up by as much as 30 percent starting October if ERC fails to act on the company’s petition.
“This is a clear hostage scenario where once again electricity consumers are victims. SMC has cornered us in a lose-lose situation where if consumers don’t pay now, they will pay more later. If ERC grants this petition, we will be basically telling SMC that it is ok to cheat on biddings by offering low prices and then adjusting them after the fact. There should be no relief for cheaters,” Arances added.
The Daily Tribune reached out to SMC for comments but to no avail as of press time.
The Department of Energy, for its part, assured that the Energy Regulatory Commission will come up with a fair and sound decision on the pending rate hike petition of SMCGP.
“We are looking at what is fully covered by the mandate of the regulatory agency and what is properly the policy which is covered by the DoE’s mandate. We will be issuing a clarification on this matter to guide the public soon,” Energy secretary Raphael Perpetuo Lotilla said in an interview on Thursday.