Press Release
June 4, 2019

Objection speech on House Bill No. 8179 Solar Para sa Bayan franchise

Mr. President, I rise to make an objection to the ratification of the Bicameral Conference Committee Report of House Bill No. 8179 as amended by the Senate. First of all I would like to extend my sincere appreciation to the Committee Chair, Chair Poe, for incorporating most of the proposed amendments of the Senate Committee on Energy. However, my objection is based on a substantive insertion in the Bicam Report that will negatively affect the power industry because of the implementation of this franchise.

This insertion is in the definition of an underserved area, which will now include areas "where electricity services have been interrupted at least twelve (12) times in the twelve (12) months preceding the date of the determination that such area is underserved". I object to this insertion because of the following reasons:

First, there is no basis for the frequency of interruptions indicated in the bicameral report. Currently, the standard for the frequency of interruptions is determined by the Energy Regulatory Commission and is updated regularly. To illustrate, the Energy Regulatory Commission's current standard for frequency interruptions for on-grid and off-grid areas is 20 times per year. To legislate a regulatory parameter would tie the hands of the regulator and would substitute our unfounded judgment for their expertise.

Second, there is no definition of the word "interruptions" in the bicameral report. We note Mr. President that frequency interruptions are not only a function of the performance of the distribution utility but also of power plant performance, availability of power supply, kind of power plant, and even calamities. As such, a distribution utility can have interruptions because of fluctuations of solar power plants, typhoons, and even shortage of supply leading to red alerts. As such, to legislate a low and unfounded bar for an area to be considered underserved would be a disservice not only to the community but would be unfair to the franchised distribution utility.

I reiterate that there is no need for this insertion as frequency interruptions are already taken into consideration in the senate version of the bill which defines underserved areas as those areas which are "non-compliant with the service parameters of the Philippine Distribution Code" or "any other reason resulting in any failing mark based on the latest annual evaluation of actual performance of distribution systems as compared to imposed targets of the Energy Regulatory Commission".

With that Mr. President, as the Chairman of the Senate Committee on Energy of the 17th Congress, I object to the ratification of the bicameral report of House Bill No. 8179 as amended by the Senate.

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