Republic of the Philippines
PROVINCE OF ORIENTAL MINDORO
City of Calapan
SANGGUNIANG PANLALAWIGAN
COMMITTEE REPORT NO. 171 - 2011
-------------------------------------------------------------------------------------------------------------------------------SUBMITTED BY:
COMMITTEE ON POWER AND ENERGY
SUBJECT:
MANIFESTATION OF HONORABLE BOARD MEMBER MARTIN S.
BUENAVENTURA DURING THE 51ST REGULAR SESSION OF THE
SANGGUNIANG PANLALAWIGAN OR ORIENTAL MINDORO RELATIVE
TO THE FREQUENT OCCURENCES OF LONG BROWN-OUTS IN THE
PROVINCE, PARTICULARLY IN THE SECOND DISTRICT
FOR:
THE HONORABLE PRESIDING OFFICER
-------------------------------------------------------------------------------------------------------------------------------Dear Honorable Presiding Officer:
The above subject was referred to the Committee on Power and Energy of
Sangguniang Panlalawigan of Oriental Mindoro on June 30, 2011. Due to
significance of the said matter to the lives of the people of Oriental Mindoro,
Committee conducted a hearing on 07 July 2011, which was attended by
following:
a.
b.
c.
d.
e.
f.
g.
h.
i.
j.
the
the
the
the
Hon. Romeo G. Infantado, Committee Acting Chairperson;
Hon. Ryan Z. Arago, Committee Member;
Hon. Ramil O. Dimapilis, Committee Member;
Hon. Martin S. Buenaventura, Committee Member;
Hon. Gideon B. Abuel, Committee Member;
Hon. Abraham R. Abas, Guest Committee Member;
Atty. Kristine Grace L. Suarez, Provincial Legal Officer;
Representatives from ORMECO, headed by Mr. Audel Arago, President – BOD of
ORMECO;
Representatives from National Power Corp. – Oriental Mindoro, headed by Engr.
Maximo Delos Reyes, NPC-SPUG Superintendent; and
Staff from Provincial Information Office.
This Committee has the honor to report before this Honorable Body the outcome
of the said legislative undertaking after thorough deliberation of the issue at hand, to
wit:
1. That, the ORMECO is dependable on the following power sources: (a) Dulungan
Mini-Hydro Power Plant (1.6 megawatts); (b) National Power Corporation (NPC)Agrekko – Calapan (17.0 megawatts); (c) Mirant/Global Philippines in
Pinamalayan (6.0 megawatts); and, (d) NPC-Agrekko stationed in Mamburao,
Occidental Mindoro (4.0 megawatts), with a total power load of 28.6
megawatts.
2. That, according to representatives from ORMECO the current power interruptions
being experienced provincewide were attributable to the implementation of
Annual Preventive Maintenance of transmission lines and power generators of
NPC and Mirant/Global Power Corporation as well as the implementation of
System Load Reduction Program of the NPC.
3. That, the schedules of power interruptions due to the implementation of Annual
Preventive Maintenance were the following:
a. July 2 and July 3, 2011 from 7:00 A.M. – 5:00 P.M. affecting the areas
covered by the NPC’s NPC 69KV Transmission Line to wit: Naujan, Victoria,
Socorro, Pola, Bansud, Bongabong, Roxas, Mansalay and Bulalacao.
b. July 5, 2011 from 7:00 A.M. to 5:00 P.M. affecting the areas covered by the
NPC’s 50MVA Substation, to wit: Calapan City, San Teodoro and Puerto
Galera.
4. That, notably, it was revealed that the Annual Preventive Maintenance of the
NPC’s 50MVA Substation in Calapan City was not conducted for reason that the
NPC’s technical crew did not arrive on the scheduled date. Thus, said
preventive maintenance will be re-scheduled to other date.
5. That, during the hearing, it was disclosed that even if the preventive
maintenance schedules were already concluded, power shedding would still
continue because of the System Load Reduction Program of the NPC. Said
program is being implemented by the NPC because of its critical inventory of
fuel.
6. That, likewise, due to the said critical inventory of supply of diesel for power
generators, the 4.0 MW of the NPC-Agrekko stationed in Mamburao was not
supplied and the power supply from Mirant/Global was trimmed down by 2.5
MW. According to the NPC, bidding for supply of diesel for their power
generators in Mamburao, Occidental Mindoro failed, thus aggravating the
situation. Per manifestation of Engr. Maximo Delos Reyes from NPC, their fuel
allocation for April to June can be stretched out until July 5, 2011. For the third
quarter, fuel allocation for the NPC – Oriental Mindoro was already bid out but,
unfortunately, it covers only the months of July and August, as the NPC’s daily
consumption of diesel amounts to 98,000 liters for the 28.6 MW covering the
areas from Calapan to Bulalacao. The NPC-Oriental Mindoro warned that, worst
come into worse, when fuel allocation for NPC-Oriental Mindoro will not realize
on schedule, its power generators will all be shutting down consequently total
power black outs may happen probably in September and would last until said
problem has been properly addressed.
7. That, responding on the query of Honorable Martin S. Buenaventura why the NPC
did not make accurate projection for the yearly consumption of fuel of their
power generators, Engr. Delos Reyes clarified that the NPC-Oriental Mindoro
religiously prepared and submitted the same however it was the NPC National
Office who trimmed down their fuel allocation due to budgetary constraint. He
said that problem on fuel allocation were being experienced not only by NPCOriental Mindoro, but also of all the provinces nationwide under the NPC-Small
Power Utilities Generation. He also revealed that NPC-Oriental Mindoro is
receiving the highest fuel allocations per year among all the NPC-SPUG
nationwide.
8. That, the problem on fuel allocations for the NPC-SPUG begun when the
Universal Charge collected from power consumers was decreased from P0.90 to
P0.45.
9. That, the NPC-SPUG’s stay in the province for its missionary electrification has
been long overdue as its supposed phase out was scheduled since 2004. Such
delay was due to the fact that sufficient and new players in power generations
in the province have not yet been assured.
10. That, on the query of the Honorable Ramil O. Dimapilis on the possibility that the
Provincial government would make advances to ORMECO for its electricity
consumption, which in turn the amount for such will be used to purchase the fuel
allocation of NPC so as to forestall the looming problem on the supply of
electricity, Atty. Kristine Grace L. Suarez said that such scheme may be allowed
emphasizing its significance on the socio-economic condition of the province
and its people. However, fuel allocation for the NPC Gen Sets covering one
month period is amounting to Four Hundred Million Pesos.
11. That, the ORMECO, in anticipation to the NPC-SPUG phase out in the province, is
forging power supply agreement with qualified independent power producers
such as the ORMIN Power Corporation. ORMECO BOD President Audel Arago
disclosed that agreement between the Cooperative and Ormin Power
Corporation underwent Competitive Selection Process and as such the
production cost of P13.0 by Ormin Power will be reduced to P6.98 per kilowatthour. The remaining production cost will be subsidized by the NPC as provided
for under the Electric Power Industry Reform Act (EPIRA). In that way, BOD
President Arago surmised that the said power supply agreement is
advantageous to ORMECO and its member-consumers. He also revealed that
under the agreement the Ormin Power will provide 6.4 MW with its four brand
new modular generator sets, which are all ready for transit to the province. He
also said that the said corporation successfully secured provisional authority from
the Energy Regulatory Commission (ERC) for a period of six months subject to
compliance on the requirements imposed by the said Commission. According
to him, failure on the part of the Ormin to comply with those requirements
imposed by the ERC, ORMECO is ready to terminate their agreement with said
corporation.
12. That, the installation of four modular generator sets of Ormin Power is expected
to be concluded by the end of September 2011 and shall be generating
electricity after one month of test run. In such case, it cannot be the immediate
solution to the looming problem of total power black-out in the entire province in
case supply of fuel for NPC’s gen sets remains unsolved until August 30, 2011.
13. That, clarification was made regarding the Linao-Cawayan Mini-Hydro Power
Plant Project. ORMECO representatives disclosed that the said project is still
being implemented, which is funded through DBP loan, and is almost 85%
complete. According to them, what has been dissolved was the LinaoCawayan Mini-Hydro Power Plant Corporation, which was registered under the
names of ORMECO Board of Directors and officials – the same being violative of
the EPIRA law. According to BOD President Audel Arago, they overlooked legal
implications in registering the said corporation under their names as they only
emulate the practice of other electric cooperatives. Fortunately, he said that all
the documentary requirements were accomplished under the name of
ORMECO; hence, the implementation, operation and maintenance of said
project remains under the said cooperative. He said that the Linao-Cawayan
Mini-Hydro Power Plant will be operating with an independent book of accounts
since it is considered power generation utility separated from the book of
accounts of the ORMECO as power supply entity pursuant to existing law. When
already operational, the power cost to be imposed by the said mini-hydro power
plant will be P5.25 per kilowatt-hour and, after the payment of loan in 10 – 12
year period, the said amount will be reduced to P2.22 per kilowatt/hour.
14. That, on the query of the Honorable Romeo G. Infantado on reason why said
mini-hydro power plant project was not offered to businessmen in the province;
BOD President Arago opined that it would be disadvantageous for the
cooperative’s members-consumers to have that project be undertaken by the
private investors since they are usually profit-oriented unlike the ORMECO which
is service-oriented.
15. That, according to ORMECO the members-consumers were properly informed of
the scheduled power shedding as they provide fliers to various offices as well as
vehicles of the ORMECO with public address system were deployed
provincewide. They said that they also used local media outlets in their
information dissemination campaign.
16. That, on the issue of provincewide total power black-out, BOD President Arago
requested to the Committee for the sponsorship of SP Resolution requesting His
Excellency President Benigno Simeon C. Aquino, through the National Power
Corporation (NPC) President, to prioritize the NPC-SPUG in the Province of
Oriental Mindoro for the allocation of its required fuel supply and to provide in
the soonest time possible its fuel allocation requirements for this year’s third and
fourth quarters. He said that the ORMECO religiously and faithfully settled their
accounts with the NPC and yet the cooperative is still being affected by the said
problem of the NPC.
17. That, this Committee agreed that the said request has to be communicated to
the Honorable Provincial Governor who, in turn, will request the Provincial Board
for the passage of a resolution to that effect. In view of the same, BOD President
Audel Arago said that ORMECO will make such communication to facilitate the
request to His Excellency through SP Resolution.
Based on the foregoing premises, this Committee respectfully recommends to
this Honorable Body to terminate further consideration of the subject at hand and to
wait for the request of the ORMECO, to be indorsed by the Provincial Governor, for the
passage of a resolution requesting His Excellency President Benigno Simeon C. Aquino
III, through NPC President, to prioritize NPC-SPUG in the Province of Oriental Mindoro in
the allocation of fuel to ensure efficient and continuous operation of its power
generators.
(Sgd.)
HON. ROMEO G. INFANTADO
Temporary Chairperson
MEMBERS:
(Sgd.)
HON. RYAN Z. ARAGO
(Sgd.)
HON. RAMIL O. DIMAPILIS
(Sgd.)
HON. MARTIN S. BUENAVENTURA
(Sgd.)
HON. GIDEON B. ABUEL