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POWER Advocate Romeo “Butch” Junia said the Department of Energy (DOE) should stop dealing with a private power generation firm because an on-going submarine cable project will bring cheaper electricity through interconnection between Bantayan Island and mainland Cebu.

The submarine cable was a project of the late Cebu 4th District Congressman Benhur Salimbangon who died last December 24, 2020, and now monitored by Benhur’s wife, incumbent Rep. Janice Z. Salimbangon.

If the interconnection project will be realized, the Bantayan Island power rate will be the same as the rate in mainland Cebu which is P7 per kilowatt hour.

Before he died, Salimbangon called Cebu Business Week and said that his submarine cable project will connect Bantayan Island to Cebu-Negros-Panay (CNP) power grid to decrease the electricity cost in the island with an estimated 150,000 people.

At present, the power rate in Bantayan Island is high but there is no serious concern from Bantayan Island government officials and businessmen because they are subsidized by the Universal Charge for Missionary Electrification (UCME).

Junia said that UCME was authorized under Section 70 of the Energy Power Industry Reform Act (EPIRA). The law provides that all electric consumers shall pay UCME.

Junia explained that all power consumers in the main grid are paying UCME to subsidize electricity in Bantayan Island at 11.56 centavos per kilowatt hour. This is separate from the petition of National Power Corporation (NPD) asking ERC for an increase to 20.7 centavos per kilowatt hour for the year 2021.

Junia said that looking at the supply agreement in Bantayan Island, the ERC approved the rate of P27 per kilowatt hour and the Bantayan Island people will just pay P6.25 per kilowatt hour because of the UCME subsidy.

This means that Bantayan Island people will be subsidized at P20.75 per kilowatt hour by power consumers of Visayas Electric Company (VECO) and Manila Electric Company (MERALCO) and the rest of the country.

“This is immoral, illegal and unfair,” Junia said.

“The late Rep. Salimbangon urged all LGU officials to support the submarine cable project, but the mayors of Bantayan town, Sta. Fe and Madridejos endorsed this P27 per kilowatt hour rate under a power supply agreement for 15 years with a proposed rate of P13.38,” Junia said.

“Why sign a 15-year contract when the submarine cable interconnection is ongoing? If they will interconnect five years from now, they will continue paying higher power rate for another ten years.”

Junia urged DOE to stop contracting private power generator with high power rate.

If DOE will allow new contracts, it should be at a lesser cost. The private power generator in Bantayan Island which BANELCO will sign a contract for 15 years cannot be judged as less cost because there is no competitor even during public bidding.

Under the guideline of the competitive selection process, BANELCO must receive two or more bidders. If only one bidder shows up. BANELCO must declare a failed bidding and invite more bidders and call for another bidding.

Junia said that an EPIRA provision stated that UCME will be phased out three years after the law is adopted. EPIRA took effect in 2001; hence UCME should have become non-existent by 2004 or 2005.

Junia said that in January 2019, DOE Secretary Alfonso G. Cusi issued a guideline that in six months, DOE, NPC, and other agencies involved in collecting and disposing UCME shall make a system that power consumers should not anymore shoulder the cost of UCME and just charge it from government tax collection.

But there is still no concrete result of the 2019 guideline issued by Cusi until now.