You are currently browsing the tag archive for the ‘power’ tag.

By Francis Allan L. Angelo

AN independent power producer in Iloilo City is reaching out to prospective investors in the metropolis to address their projected energy requirement.

Engr. Henry Alcalde, project manager of the 164-megawatt coal-fired power plant of Global Business Power Corp. (GBPC), said they expect the demand in Panay to increase once their new plant operates next year.

“If you lower the cost of power, you encourage consumption. Lower prices will also attract businesses in our area. And once these investors come in, they will gradually use up the capacities of the new coal-fired power plant and the diesel plant. How fast this demand will be, we don’t know. But once the demand gets higher than our capacity, we will try to address that,” Alcalde said.

The coal-fired power plant will be operated by the Panay Energy Development Corp. (PEDC), a subsidiary of GBPC under the Metrobank Group. It is expected to go online in the last quarter of 2010.

The construction of the coal-fired power plant has resulted in renewed interests by investors to enter Iloilo City, particularly business processes outsourcing (BPO) firms.

A major investor expected to do business in the city is giant land developer Megaworld which bought the old Iloilo airport lot in Mandurriao district for P1.2 billion.

Megaworld is planning to develop the 54.5-hectare lot into a new business district with facilities such as hotels, convention center and BPO offices.

Industry sources said Megaworld would require around 20MW of power for its initial operations which is estimated to cost P1.5 billion.

Recently, the National Grid Corporation of the Philippines (NGCP), which handles the transmission side of the energy sector, made a positive projection on the energy needs in the Visayas grid.

Without factoring in the projected huge power demand from new growth areas such as the 300-hectare South Road Properties in Cebu City and the 54-hectare Megaworld property in Iloilo City, the NGCP said the next round of power supply problems in Cebu, Negros and Panay would be felt in 2018.

Alcalde said NGCP’s projections somehow jives with their own forecast, with Iloilo City suffering a 4-MW shortfall by 2014 on an annual demand growth of 3%. This does not include Megaworld’s demand. 

Engr. Gil Altamira, GBPC commercial manager, said they are reaching out to Megaworld to find out how much power they will need.

“Power plants don’t just pop up like mushrooms. We have to know the needs of the consumers so we can plan ahead of time, whether Engr. Alcalde will put up another unit.” Altamira said.

In Negros and Panay, load growth averaged 6.1% and 5.9%, respectively, this year. Panay’s load grew nearly 50% in 2007 only because the Panay Electric Co., Inc., sole electricity distributor in Iloilo City, was synchronized to the grid that year.

Growing demand has used up power reserves in the grid, leaving Cebu, Negros and Panay vulnerable to outages whenever a plant breaks down. Rotating brownouts have been the norm in these islands since summer.

Cebu’s actual peak demand this year reached 577 MW, while those of Negros and Panay hit 226 MW and 221 MW, respectively. Including Bohol and Leyte-Samar islands, the Visayas’ actual peak demand this year reached about 1,300 MW.

The Cebu-Negros-Panay grid gets 360 MW from the geothermal fields in Leyte, boosting total dependable capacity in the Visayas to 1,466 MW. Of the 360 MW, 200 MW goes to Cebu first and the balance is divided between Negros and Panay.

Cebu, Negros and Panay are expected to continue to experience power shortage until the first quarter of 2010, when the first of three 82-MW coal plants that Cebu Energy is building in Toledo City comes onstream.  (With reports from BusinessWorld)

Advertisements

Artech admits contract with Ileco-3 defective

By Francis Allan L. Angelo

NO less than the vice president of Applied Research Technologies Phils. (Artech) admitted that their power supply agreement (PSA) with Iloilo Electric Cooperative (Ileco 3) is flawed.

Atty. Ramil Naciongayo, counsel for complainants Gerardo P. Panes and Evelyn P. Peñaflor, said Artech vice president for administration and business development Domingo Beltran admitted the defects in the 25-year contract before the National Electrification Administration (NEA) investigation committee looking into the alleged bribery and onerous provisions of the Artech-Ileco 3 contract signed last April 21, 2009 in Iloilo City.

The story hugged the headlines after Ileco 3 board president Mateo Baldoza claimed that he received cash-laden envelope from Iloilo Gov. Niel D. Tupas Sr. during a meeting with Artech officials at the governor’s house last April 17.

The cash, Baldoza assumed, was meant to facilitate the negotiations and approval of the power supply agreement offered by Artech.

Naciongayo said Atty. Xerxes Adzuara, NEA probe committee chair, discovered the flaw when they went over Beltran’s affidavit.

Beltran claimed in his affidavit that the contract is beneficial to Ileco 3 because Artech will construct the transmission facility to link the cooperative to the power producer’s proposed diesel and biomass plants.

Beltran said Artech will shoulder the construction so that Ileco 3 will not charge transmission fees on its consumers. The cooperative will only maintain the transmission facility.

But Section 9.2 of the PSA provides that Ileco 3 will construct and maintain the transmission facility.

Beltran told the panel that they are willing to amend the contract in keeping with Artech’s commitment to put up the facility.

He added that Artech prepared the contract which the Ileco 3 board later approved and signed through Baldoza.

Naciongayo said the defect only shows that the Ileco 3 directors did not study the contract which Artech prepared and offered to them.

“The board did not study the contract before approving it because they missed the discrepancy between what was agreed verbally during the negotiation and what is written in the contract. Had they taken time to read the provisions, they could have found it beforehand. And Beltran admitted that there was a flaw in the contract,” Naciongayo said.

IS ARTECH CAPABLE?

Naciongayo also pointed out the conflicting interpretation of Beltran and the contract on when the agreement will take effect.

Section 3.3 of the PSA provides that the contract shall become effective upon its execution and when the plant is ready to deliver electricity.

But Beltran told the NEA panel that commercial operations will only start once the Energy Regulatory Commission (ERC) approves the PSA.

Beltran said they have yet to submit the PSA to the ERC because it is Ileco 3’s job.

Naciongayo said Beltran’s interpretation of the contract’s effectivity is disadvantageous to the cooperative as it will be at the mercy of Artech.

“What if Artech does not do anything? Ileco 3 will be left hanging and that will endanger the power needs of its consumers,” the lawyer said.

Naciongayo also cited Artech’s contract with Capiz Electric Cooperative (Capelco) which took seven years to commence.

He said the Artech-Capelco contract was signed in 2001 but it was only approved in 2008.

Artech later formed another corporation, Enervantage, by partnering with a prominent family in Capiz in order to fulfill its contract with Capelco.

“Right now, Artech has no contract with Capelco, its Enervantage. This is a question of Artech’s capability to deliver its commitment,” Naciongayo said.

NO DISCOUNT

Naciongayo also hit Beltran’s justification before the NEA panel why Artech did not include the prompt payment discount in the 25-year PSA.

“Mr. Beltran said the discount is just a decoration in supply contracts as they have not encountered any cooperative that pays their bill within the 3-day period. In this case, Artech is assuming that Ileco 3 cannot pay its bills on time. Artech actually does not trust the cooperative to fulfill its part of the contract. So why is Artech doing business with Ileco 3 if there is no trust and confidence between them,” he said.

The discount, which is usually pegged at 3%, is an incentive to cooperatives that pay their suppliers within three days upon receipt of the monthly billing. The discount is a feature of power supply contracts to encourage power distributors to pay their suppliers promptly.

BALDOZA CONFESSION

Last Tuesday Ileco 3 board President Baldoza admitted before the NEA panel that Gov. Tupas gave him money in exchange for his approval of Artech’s offer.

Naciongayo said he suggested to the National Bureau of Investigation (NBI) to secure copies of the transcript of Baldoza’s admission.

He said the transcript could be a basis for the filing of criminal cases against personalities involved in the Artech-Ileco 3 bribery scandal.

“The NBI said they will request the NEA administration committee to provide the transcript of Baldoza’s admission. The NBI has been investigating this case as regards the bribery angle,” Naciongayo said.

Naciongayo said there is also a chance that the 25-year PSA might be rescinded or annulled because of the onerous provisions.

By Francis Allan L. Angelo

ILOILO Electric Cooperative (Ileco 3) board president Mateo Baldoza, a former court judge, has no credibility, according to Iloilo Gov. Niel D. Tupas Sr.

This was Tupas’ reaction to Baldoza’s admission that the governor gave him an envelope with cash inside to favor independent power producer, Applied Research Technologies Phils. Inc., (Artech).

The alleged bribery, Baldoza told the National Electrification Administration investigating committee, happened April 17 during a meeting with Artech officials at Tupas’ mansion in Jaro, Iloilo City.

Tupas said in an interview with Bombo Radyo that Baldoza has no credibility because he kept changing his statements.

“At first he claimed that I gave him money then denied it. Now, he is saying that I did it. He always changes his story. He has no more credibility,” Tupas said.

The governor said Baldoza is the only person claiming that there was bribery in the Ileco 3-Artech deal while the other directors have nothing to say.

Tupas said Baldoza is being used by persons who want to besmirch his name and reputation as the 2010 election period nears.

“The election fever is here and these are just efforts by some groups to malign me. I pity Baldoza,” he said.

Tupas had admitted summoning Ileco 3 and Artech officials to a meeting in his house to discuss the looming power crisis in the cooperative’s franchise area.

But the governor denied handing out money to the Ileco 3 directors.

Baldoza: Tupas gave me envelope with cash 

By Francis Allan L. Angelo 

A RETIRED judge and president of the Iloilo Electric Cooperative (Ileco) 3 board finally admitted receiving money from Iloilo Gov. Niel D. Tupas Sr. to favor an independent power producer.

Mateo Baldoza confirmed his first statement over Aksyon Radyo-Iloilo last May 5 that Tupas handed him an envelope filled with cash during a meeting with officials of Applied Research Technologies Phils. (Artech).

Baldoza made the admission during the hearing yesterday conducted by the National Electrification Administration (NEA) investigation committee on the alleged bribery issue involving Artech and Ileco 3 officials.

The hearing was held at the Ileco 1 main office in Tigbauan, Iloilo Tuesday to look into allegations that Artech handed cash to the directors to approve the 25-year power supply agreement the firm offered to the cooperative.

Baldoza spilled the beans on Artech and Tupas during the examination conducted by Atty. Ramil Naciongayo, counsel for the complainants Gerardo P. Panes and Evelyn P. Peñaflor who called for the NEA probe.

According to Baldoza, he and the Ileco 3 directors were called to a meeting with Artech officials led by president Reynaldo Uy at Tupas’ mansion in MV Hechanova, Jaro, Iloilo City last April 17, 2009.

Baldoza said Tupas called him inside a room of the mansion where the latter gave him an envelope while telling him to help Artech.

The retired judge later learned that the envelope contained P75,000 cash when he got home from the meeting.

He also confirmed that he received another envelope with P75,000 cash after their board meeting April 21, the day they approved the power supply deal with Artech.

In sum, Baldoza received P150,000 cash from Artech. Uy and Tupas had denied Baldoza’s allegations.

Aksyon Radyo anchorman Joel Tormon also testified before the AdCom relative to his May 5 interview with Baldoza.

Tormon said he confirmed the authenticity of the transcript of his interview with Baldoza which was admitted as evidence in the NEA probe.

Tormon said Baldoza’s statements during the NEA hearing were the same information and sequence of events the latter told during the May 5 interview with Aksyon Radyo-Iloilo.

A day after his interview with Tormon, Baldoza modified his statement in a local newspaper saying a woman employee of Artech gave the cash-laden envelope during the meeting at Tupas’ mansion.

But he again hinted that the governor gave him the cash-filled envelope when he faced the probe conducted by the National Bureau of Investigation (NBI).

In his affidavit submitted to the NEA AdCom last August, Baldoza said he received the cash-filled envelope from someone during the meeting at Tupas’s mansion.

Baldoza said that after eating at Tupas’s house, he was called inside the living room where that “someone” thrust the envelope in his hand.

By Francis Allan L. Angelo

MEMBERS of the Iloilo Electric Cooperative (Ileco) 3 board of directors have until next month to answer allegations that they were bribed to approve a 25-year power supply agreement (PSA) with an independent power producer (IPP).

The Administration Committee (AdCom) of the National Electrification Administration (NEA) gave the directors until September 12 to submit their position papers as regards the bribery yarn.

Atty. Xerxes D. Adzuara, NEA AdCom chair, set the deadline after the preliminary hearing conducted at Ileco 3 head office in Sara, Iloilo Thursday morning.

The hearing began around 9am until past 10am and was attended by the Ileco 3 board headed by former Judge Mateo Baldoza, Rene Arandilla, Emmanuel Pacardo, Azur Salcedo, Achilles Pama and Vincent Francis Espinosa.

The directors were aided by their legal counsels Edison Belloga and Joseph Anthony Lutero.

Instead of a full blown hearing, the directors asked the AdCom that they will just submit their position papers.

Adzuara said they will make their recommendation to NEA Administrator Editha Bueno a month after the Ileco 3 directors submitted their position papers.

“If they don’t submit their position papers, this case will be submitted for decision to the NEA board meeting,” he added.

The NEA investigated the Ileco 3 board due to the complaints filed by two consumers following Baldoza’s exposé that he received P150,000 from Iloilo Gov. Niel Tupas Sr. and officials of Applied Research Technologies Philippines, Inc. (Artech).

The money, Baldoza said in his interview with Aksyon Radyo last May 5, was meant to facilitate the approval of the PSA with Artech which NEA recommended to be rescinded due to alleged onerous provisions.

 

SOMEONE?

But in his sworn affidavit which he made available yesterday, Baldoza pulled back his punches.

Baldoza said that he received from “someone” last April 17 an envelope containing P75,000 during a meeting with Artech officials at the house of Gov. Tupas in Jaro, Iloilo City.

Baldoza said that after eating at Tupas’s house, he was called inside the living room where “someone” thrust the envelope in his hand.

In his May 5 interview, the former judge said Tupas handed him the money. But he changed his tune in another interview May 6 saying a female Artech employee gave him the money at Tupas’s house.

He again hinted that the governor gave him the cash-filled envelope when he faced the probe conducted by the National Bureau of Investigation (NBI).

In an interview with Aksyon Radyo yesterday, Baldoza said he revealed the persons behind the alleged bribery to the NBI. He will also detail what happened at the governor’s house in his position paper to the NEA.

Aside from the April 17 meeting in Tupas’s house, Baldoza also claimed that he received another P75,000 from an Artech employee during their special board meeting in Iloilo City last April 21.

NEA says Artech-Ileco 3 PSA disadvantageous to coop

By Francis Allan L. Angelo 

A FACT-finding team of the National Electrification Administration (NEA) recommended the scrapping of the power supply agreement (PSA) between Iloilo Electric Cooperative (Ileco 3) and an independent power producer.

The report of the probe team headed by Atty. Omar Mayo, NEA legal department chief, said the PSA between Ileco 3 and Applied Research Technologies Phils., Inc. is “grossly disadvantageous and prejudicial to the interests of the cooperative and its members-consumers.”

The team submitted its findings to NEA Administrator Edith Bueno June 5, a month after Ileco 3 board president Mateo Baldoza revealed to Joel Tormon of Aksyon Radyo that he received P75,000 from Gov. Niel Tupas Sr.

Baldoza said in the May 5 interview that Tupas gave him the money during a meeting with Artech officials at the governor’s house in Jaro, Iloilo City.

The NEA probers said there was “undue haste, aggravated by bribery, in the signing of the said PSA, totally disregarding the findings of the very own technical personnel of Ileco 3.”

The team recommended the following actions to NEA board of administrators:

–         assign a NEA project supervisor at Ileco 3 to monitor the operations and transactions in the cooperative;

–         the PSA, upon the initiative of Ileco 3, be rescinded for being grossly disadvantageous and prejudicial to its interests;

–         investigate the notarized letter-complaints of two Ileco 3 consumers for proper action by NEA including, but not limited to, the preventive suspension of the Board Directors who voted for the PSA, either by active participation or tacit consent.

Edgardo Piamonte, NEA deputy administrator, confirmed that the team has submitted its report to the board for its approval.

Piamonte said a project coordinator will arrive in Ileco 3 Wednesday next week to start monitoring the cooperative’s operation.

Bribery

The NEA probers also found that bribery may have took place prior to the signing of the contract.

The finding was based on the sworn affidavit of Ileco 3 director Rene Arandilla and Baldoza’s radio interview with Askyon Radyo.

The investigators said Arandilla’s affidavit is credible because he personally heard from Baldoza about the additional P75,000 from Artech after the signing of the contract April 21 in Iloilo City.

“Baldoza himself showed the envelope to Arandilla, who was asked by the former to count the contents thereof, amounting to P75,000. Stated differently, the portion of the affidavit on the ‘additional’ amount in the envelope was a product of the personal knowledge of Arandilla, and cannot be denominated as hearsay evidence. In point of fact, Arandilla – with the express consent of Baldoza, was even tasked to count the money inside the ‘additional’ envelope,” the report said.

While Baldoza changed his tune on who gave him money at Tupas’s house, his recantation “cannot obliterate the fact of bribery” in the deal.

“The ‘revision’ in the recantation of the Board President touches base only on the person who gave the money, as the latter pronouncements would tend to show that the same official/representative gave the first and second amounts. At bottom, whether it was the Governor or the Artech representative who gave him the first and the second envelopes is of no moment, as it refers only to the giver but does not, in any way, deny the act itself,” the report said.

Baldoza recently said he told the National Bureau of Investigation that Tupas handed him the money last April 17. 

No bidding; railroaded 

The NEA investigators said the Ileco 3 board failed to analyze the PSA that will bind Ileco 3 consumers to Artech in the next 25 years.

It was also noted that Artech was not among those IPPs which submitted bids to the consortium to supply power to seven electric cooperatives in Panay and Guimaras Islands.

“There was undue haste in entering into contract as it took only 16 days for the board to decide to ink the contract with Artech. When compared to the consortium, the period is very short, as it took them about four months to study and evaluate offers of the different IPPs. The duration of the contract is no less than 25 years, which would all the more necessitate the exercise of prudence to afford the members-consumers the best possible deal on the matter of electricity rates. Artech personnel furnished the members of the board copies of their proposed contract for study and evaluation on April 5, 2009 and was signed April 21, 2009,” the report said.

While the Ileco 3 board claimed that Artech presented its proposal during the board meeting March 18, “nothing can be found in the minutes of board meetings that a thorough and extensive deliberation/evaluation was ever conducted on an important issue, so as to warrant the signing of the contract.”

No contract review

The NEA probe team also scored the Ileco 3 board for failure to submit the contract to NEA for requisite review of its provisions.

The NEA report said this lack of NEA approval of the Ileco 3-Artech deal “raises the proverbial quizzical eyebrows, considering that a similar PSA was entered into by and between CAPELCO (Capiz Electric Cooperative) and the same IPP.”

“Why did Artech agree with CAPELCO to subject its PSA to contract review by NEA while totally shutting out NEA from reviewing its PSA with Ileco 3?” the NEA report said.

The investigators said NEA’s omission from the deal was “designed to ‘cut corners’ and expedite the signing of the contract, as referral of the PSA to NEA for review would further delay the signing and set back the timetable.”

Baldoza pinning down Tupas?

 

By Francis Allan L. Angelo

 

WHAT did former Judge Mateo Baldoza tell the National Bureau of Investigation (NBI) relative to the power supply agreement (PSA) between Iloilo Electric (Ileco) 3 and Applied Research Technologies Phils., Inc. (Artech)?

 

“I told the truth,” said Baldoza, Ileco 3 board of directors president, when asked about his meeting with NBI investigator Arnold Diaz.

 

Baldoza said he cannot give the full details of his testimony to the NBI “because it is confidential.”

 

Baldoza said what he told NBI is the same thing he told Presidential Assistant Raul Banias and other persons regarding the April 17 meeting with Artech officials at the house of Governor Niel Tupas Sr. in Jaro, Iloilo City.

 

Banias earlier told The Daily Guardian that Baldoza informed him about the pressure and the P75,000 cash he received from Tupas, obviously to grease the approval of the PSA between Ileco 3 and Artech.

 

Baldoza also told Banias about the second P75,000 he received from an Artech employee during the Ileco 3 board meeting in Iloilo City last April 21.

 

The former judge also told Joel Tormon of Aksyon Radyo last May 5 about the money he received from Tupas and Artech on those two separate occasions. But Baldoza modified his statement a day later saying a female Artech worker gave the money at Tupas’ house.

 

Tupas had denied giving money to Baldoza although he and provincial administrator Manuel Mejorada admitted that Ileco 3 directors met Artech president Reynaldo Uy at the governor’s house April 17.

 

Tupas and Mejorada said Baldoza has “no credibility” because he kept changing his statement regarding the alleged bribery of Ileco 3 directors.

 

The governor said he only intervened to avert a looming power shortage in Ileco 3 franchise area when its transition supply contract with the National Power Corp. expires next year.

 

Ileco 3 legal counsel Edison Belloga also denied the bribery angle even as he defended the PSA to be advantageous and environment friendly.

 

Banias said he met Baldoza after the latter’s visit to the NBI regional office.

 

“He told me that what he narrated to the NBI was the same as his original statement in an interview with Aksyon Radyo and the information he told me before the issue on the Ileco 3-Artech deal came out in the media,” Banias said.

 

Banias said Baldoza was not able to sign his affidavit narrating the April 17 and 21 meetings “because his lawyer was not present during the meeting at the NBI.”

 

Atty. Diaz, who is in-charged of the investigation, said Baldoza’s statement was substantial to their probe but he declined give details.

 

Banias said Baldoza is also willing to narrate to the National Electrification Administration (NEA) the events leading to the signing and approval of the PSA.

 

“NEA is about to finish its investigation as they already gathered all the facts they need. But the investigators are willing to talk to Judge Baldoza and get his side of the story,” he said.

 

DEATH THREATS

 

Meanwhile, Banias claimed receiving death threats relative to the Ileco 3-Artech deal.

 

Banias said a friend passed to him a text message from an unidentified sender saying that the former will die before June 5.

 

When asked if he still has the threatening message, Banias said he cannot locate the text in his cellphone.

 

“It may have something to do with the Ileco 3 issue because June 5 was supposed to be the schedule of the next hearing of the Sangguniang Panlalawigan on the issue. I did not mind it and I did not report it to the police because I also have my own bodyguards,” Banias said.

By Francis Allan L. Angelo

 

ILOILO Governor Niel Tupas Sr. questioned the credibility of the whistle blower of the alleged bribery that attended the power supply deal between Iloilo Electric Cooperative (Ileco) 3 and an independent power producer (IPP).

 

In his letter to Edita Bueno, National Electrification Administration chief, Tupas said the statements of former Regional Trial Court judge Mateo Baldoza, who is also the president of the Ileco 3 board of directors, is nothing but idle talk.

 

Baldoza claimed in an interview with Joel Tormon of Aksyon Radyo last May 5 that Tupas gave him an envelope containing P75,000 during a meeting with executives of Applied Research Technologies Phils., Inc. (Artech) at the governor’s house in Jaro, Iloilo City last April 17.

 

Baldoza later modified his statement saying it was a female employee of Artech, not Tupas, who gave him the envelope.

 

“The credibility of Atty. Baldoza is questionable. His supposed revelation is hearsay,” Tupas said in the letter dated May 22, 2009.

 

In an earlier media interview, Tupas said it was only Baldoza who claimed that money changed hands during the meeting with Artech.

 

“Of all the board members, he is the only one saying that he was bribed. Who will you believe then?” the governor said.

 

In his bloctime radio program over Aksyon Radyo Saturday, Iloilo provincial administrator Manuel Mejorada also lambasted Baldoza for changing his tune regarding the alleged bribery of the Ileco 3 board.

 

Mejorada said Baldoza has no credibility after the latter modified his statement in a latter interview with Inquirer correspondent Nestor Burgos Jr.

 

Mejorada earlier confirmed that Tupas summoned the Ileco 3 board and Artech officials led by Engr. Reynaldo Uy to a meeting at his house April 17.

 

In the same letter to Bueno, Tupas also assailed Presidential Assistant for Western Visayas Raul Banias for “twisting the truth.”

 

Banias, former mayor of Concepcion which is under Ileco 3 franchise, earlier wrote NEA asking for an investigation on the Ileco 3-Artech deal and the alleged bribe of the board of directors.

 

Tupas said it is not true that Baldoza “repeatedly admitted publicly over the media” that the governor gave the latter an envelope with P75,000 inside.

 

“Atty. Baldoza was interviewed only once when he made that statement,” he said.

 

Tupas added: “He (Banias) also embellished the false story by saying that the directors were ‘called one by one’ into a room. That wasn’t part of Atty. Baldoza’s statement in the radio interview. Asec. Banias is making up his own story.”

 

Tupas also defended Artech’s deal to Ileco 3 saying the IPP offered the lowest generation charge compared to other IPPs that joined the bidding conducted by the Panay-Guimaras power consortium.

 

REVELATION

 

Banias said that before the May 5 interview, Baldoza already revealed the alleged bribery to him, Ileco 3 director Rene Arandilla and other personalities in the 5th district.

 

Banias said that as early as Holy Week, Baldoza told him about the pressures the board received from Tupas to accept Artech’s offer.

 

Banias said Baldoza revealed the bribery in a text message and phone calls in the first week of May.

 

“It was Judge Baldoza who revealed the information to a lot of people even before his radio interview. If he changed his statement, only he knows why. But I believe in the integrity and probity of Judge Baldoza and I believe that he will eventually tell the truth,” Banias said.

 

Meanwhile, in his sworn affidavit dated May 13, 2009, Arandilla said Baldoza showed him an envelope filled with P75,000 cash given by a female Artech employee during their April 21 special board meeting, the same day they approved and signed the power supply deal at Finerock Hotel.

 

“I counted the money inside the envelope and determined to be containing P75,000 allegedly coming from Artech. President Baldoza told me to get P10,000 from the said amount because he will give the rest to the church but I refused,” Arandilla said.

RESIGN   Consumers hold placards calling for the resignation of Ileco 3 board of directors during the hearing conducted by the Sangguniang Panlalawigan Tuesday on the alleged anomalous deal between the cooperative and Artech. (Photo by Tara Yap)

RESIGN Consumers hold placards calling for the resignation of Ileco 3 board of directors during the hearing conducted by the Sangguniang Panlalawigan Tuesday on the alleged anomalous deal between the cooperative and Artech. (Photo by Tara Yap)

By Francis Allan L. Angelo

 

THE National Electrification Administration (NEA) has begun its investigation on the power supply agreement (PSA) between Iloilo Electric Cooperative (Ileco) 3 and an independent power producer (IPP).

 

Atty. Omar Mayo of the NEA legal office leads the investigation on the deal between Ileco 3 and Applied Research Technologies Phils., Inc. (Artech).

 

Assisting Mayo in the probe is Nixon Bautista, Electric Cooperative Operations Systems Audit Division OIC.

 

The investigating panel first looked for a copy of the 25-year PSA between Ileco 3 and Artech.

 

The panel also summoned Engr. Antonio Lazarraga, chief of Ileco 3 Technical Services Division, who made the comparative study and simulation of Artech’s proposal to the cooperative.

 

Lazarraga’s study showed that Artech’s generation charge will reach more than P8 per kilowatt-hour using diesel fired and biomass power plants.

 

The investigators also summoned Ileco 3 board secretary Joy Fuentes and the minutes of their special board meeting last April 21, the day the board approved and signed agreement.

 

Mayo said all resolutions passed by the Ileco 3 board must first be examined and approved by NEA before implementation.

 

In an earlier interview, Ileco 3 board legal counsel Edison Belloga said NEA approval of their resolutions is only ministerial in nature.

 

Ileco 3 board president Mateo Baldoza will also be summoned to shed light on the alleged bribery of the cooperative directors in exchange for the approval of Artech’s proposal.

 

Baldoza claimed in an interview with Joel Tormon of Aksyon Radyo last May 5 that he received an envelope containing P75,000 from Governor Niel Tupas Sr. during a meeting with Artech officials April 17 at the governor’s house in Jaro, Iloilo City.

 

Baldoza later modified his statement saying it was a female employee of Artech, not Tupas, who gave him the money.

 

The former judge received another envelope with P75,000 cash from a female Artech worker April 21 after they approved and signed the PSA.

 

Ileco 3 director Rene Arandilla said in his sworn affidavit that he counted the money Baldoza allegedly received from Artech on April 21.

 

Presidential Assistant for Western Visayas Raul Banias said Baldoza also told him about the alleged pressures and bribe they receive from Artech and Tupas.

 

TUPAS IS MAD

 

Tupas continues to fend off the alleged bribery of Ileco 3 directors that happened in his house.

 

In his letter to NEA Administrator Edita Bueno, Tupas countered the “wild, malicious and patently false accusations made by Presidential Assistant Raul Banias.”

 

Banias wrote and met Bueno last week to ask for an investigation on the Ileco 3-Artech deal.

 

Tupas told Bueno that the alleged “bribery” is not true.

 

“I did not hand over to Atty. Baldoza anything, much more an envelope containing P75,000 in cash. The story was concocted to implicate me in this controversy and put the transaction in bad light. It is not true, as alleged by Asec. Banias in his letter, that Atty. Baldoza ‘repeatedly admitted publicly over the media’ that I gave him an envelope with P75,000 inside. Atty. Baldoza was interviewed only once when he made that statement. The next day, perhaps bothered by his conscience, he retracted his statement in another interview with Philippine Daily Inquirer correspondent Nestor Burgos, Jr.,” the governor said.

 

The governor also questioned Baldoza’s credibility saying his supposed revelation is hearsay.

 

Tupas also defended the Ileco 3-Artech contract saying the IPP’s generation charge is P6.64 per kwh for the first three years for power generated by a diesel-fueled plant it will put up, and then P5.90 per kwh from a biomass power plant that is expected to be operational by 2013. 

 

Artech’s rates are cheaper compared to other IPPs that are putting up power plants in Iloilo, Tupas said.

 

“Clearly, there is no such thing as overpriced power rates. Besides, the PSA will still have to pass through the scrutiny of the Energy Regulatory Commission (ERC). The issue is without basis,” he added.

 

Tupas cautioned NEA against making any “hasty and precipitate actions that would be prejudicial to the public interest.”

By Francis Allan L. Angelo

 

THE Sangguniang Bayan of Sara, Iloilo unanimously approved a resolution calling for a congressional inquiry on the alleged bribery of Iloilo Electric Cooperative (Ileco 3) board of directors in exchange for the approval of a power supply deal with an independent power producer (IPP).

 

The Sara municipal board passed Resolution No. 7-2009 during its regular session May 11, 2009. It urged the House committee on legislative franchises to conduct an inquiry on the contract between Ileco 3 and Applied Research Technologies Phils., Inc. (Artech).

 

The committee on legislative franchises has jurisdiction on matters directly and principally relating to the grant, amendment, extension or revocation of franchises to sectors such as power, telecommunication, media broadcast, among others.

 

The board said member-consumers of Ileco 3, including residents of Sara, were shocked with the admission of Ileco 3 board president Mateo Baldoza over the media that he allegedly received P75,000 from Governor Niel Tupas Sr. and Artech in two separate occasions.

 

Baldoza would later modify his statement saying a female employee of Artech gave the money to him in a meeting with officials of the IPP at Tupas house in Jaro, Iloilo City last April 17.

 

Tupas also denied bribing Baldoza and exerting pressure on the board to approve and sign the 25-year power supply agreement (PSA) with Artech.

 

The second tranche of the purported bribe money was given to Baldoza April 21 after the board approved and signed the PSA at Fine Rock Hotel in Iloilo City.

 

The resolution said Ileco 3 approved and signed the deal “with extraordinary haste and speed” sans prior consultation with the cooperative’s technical personnel or management.

 

The SB also quoted the comparative study and simulation of Ileco 3’s Technical Services Department which “glaringly revealed” that the proposals of Artech in the PSA are “most grossly disadvantageous to Ileco 3 consumers as it offers the highest power rate.”

 

The SB also hit Ileco 3 directors for approving the deal despite the fact that Artech did not participate in the bidding conducted by the Panay-Guimaras power consortium.

 

The action of the Ileco 3 board, the resolution said, violated the provisions of the Electric Power Industry Reform Act of 2001 which directs cooperatives and distribution utilities to look for cheapest sources of power though a competitive process such as bidding.

 

The resolution also questioned the failure of the Ileco 3 board to submit the PSA to the National Electrification Administration (NEA) for review prior to the approval and signing of the contract.

 

Aside from the congressional inquiry, the SB also passed another resolution asking NEA to investigate the deal between Ileco 3 and Artech.

 

Other towns in the 5th congressional district covered by the Ileco 3 franchise are also planning to pass their respective resolutions seeking the revocation of the PSA and investigation on the alleged bribery issue.

 

The resolutions were presented to the fact-finding investigation conducted by the Sangguniang Panlalawigan Tuesday in Sara covered gym.

 

NEA administrator Edita Bueno confirmed with The Daily Guardian that they dispatched a team of investigators to look into the Ileco 3-Artech deal.

 

Sources from Ileco 3 said the investigating team, composed of technical and legal personnel of NEA, will also look into Artech’s deal with Capiz Electric Cooperative.

 

Presidential Assistant for Western Visayas Raul Banias, who also sent a letter complaint to Bueno, said he welcomes the House inquiry which will complement the ongoing NEA investigation.

 

Banias, a former mayor of Concepcion which is under Ileco 3, had confirmed Baldoza’s first statement that the latter received money from Tupas during the April 17 meeting.

 

“Administrator Bueno vowed to go into the bottom of this issue and impose the necessary actions. If the contract is proven onerous, the NEA can dismiss the entire Ileco 3 board,” Banias said.

By Francis Allan L. Angelo and Tara Yap

 

A TEAM of investigators from the National Electrification Administration (NEA) is already in Tuesday to start the probe on the alleged bribery of Iloilo Electric Cooperative (Ileco) 3 directors and the cooperative’s supply agreement with a power producer.

 

The investigators arrived after the Ileco 3 management team wrote sent a letter to NEA administrator Edita Bueno last week seeking an investigation on the 25-year power supply agreement (PSA) with Applied Research Technologies Phils., Inc. (Artech).

 

The management team also asked NEA to preventively suspend the board of directors headed by former judge Mateo Baldoza pending the investigation.

 

The NEA investigators arrived yesterday while the day the Sangguniang Panlalawigan was conducting a fact-finding investigation on the issue.

 

Bueno confirmed in a text message to The Daily Guardian that they sent investigators to look into the complaint of the Ileco 3 management team.

 

Baldoza claimed last May 5 that Governor Niel Tupas Sr. gave him an envelope filled with P75,000 cash during a meeting with Artech officials April 17 at the governor’s house in Jaro, Iloilo City.

 

Another envelope containing P75,000 cash was given to Baldoza by a female Artech worker during the board’s special meeting in Iloilo City April 21, the same day the PSA was approved and signed.

 

But Baldoza later modified his allegation saying it was not Tupas who gave him the first envelope but a female employee of Artech headed by Engr. Reynaldo Uy.

 

Ileco 3 director Rene Arandilla confirmed in his sworn affidavit that Baldoza showed him the cash-filled envelope the latter received April 21.

 

Dr. Raul Banias, Presidential Assistant for Western Visayas, said Baldoza told him about the pressures and bribe he received in exchange for the approval of Artech’s proposal.

 

Tupas’ camp denied the bribery in his house even as they blamed politics and business as the motive behind the exposé.

 

The provincial board probe was headed by Board Member Arthur Defensor Jr., committee on investments and economic enterprise chair.

 

As reported earlier, Gov. Tupas did not attend the hearing due to “prior commitments”. Also absent was Artech president Uy who instead sent Domingo Beltran, vice president for marketing and business development.

 

Beltran defended the PSA with Ileco 3 saying it will eventually drive down prices of electricity and give livelihood to consumers. He also denied that their company bribed Ileco 3 directors.

 

Except for Arandilla, the whole Ileco 3 board did not attend the hearing held at the Sara covered gym.

 

Arandilla reiterated his statements in his affidavit the board was summoned to a meeting with Artech officials in Tupas’ house.

 

After the meeting, Arandilla said Baldoza, a former court judge, told him that Tupas personally gave him P75,000 cash during the meeting.

 

Baldoza, who is in Cagayan de Oro City, said he will attend the next hearing if invited by the SP.

 

A brownout hit the covered gym during the investigation which disrupted the proceedings.

 

Ileco 3 employees were also seen wearing black armband in protest of the PSA which is seen to jack up prices of electricity in Ileco 3.

 

Several towns under Ileco 3 franchise presented their respective resolutions asking for the revocation of the PSA. They also urged for a congressional inquiry on the issue.

By Francis Allan L. Angelo

 

ILOILO Governor Niel Tupas Sr. indeed arranged the meeting between the Iloilo Electric Cooperative (Ileco) 3 board of directors and officials of an independent power producer (IPP) at his house in Jaro, Iloilo City last April 17.

 

In an interview in the weekly cable TV program Serbisyo Publiko hosted by Councilor Perla Zulueta Sunday, provincial administrator Manuel Mejorada said Tupas initiated the meeting between the Ileco 3 board and Applied Research Technologies Phils., Inc. (Artech) to address the looming power crisis in Iloilo.

 

“It is the habit of Governor Tupas to expedite matters when things go slow. He was worried that by 2010, Ileco 3 will have no more power supply because its transition power contract with the National Power Corp. will expire December 2010,” Mejorada said.

 

Engr. Reynaldo Uy, Artech president, said Ileco 3 director Asur Salcedo invited him to meet the board headed by former judge Mateo Baldoza at Tupas’ house in MV Hechanova, Jaro last April 17.

 

Uy said the meeting was set after Tupas learned that the board has yet to act on Artech’s 25-year power supply agreement after three months.

 

“Governor Tupas asked the board about our deal and president Baldoza said the offer was good. The governor then said that we must settle the matter because he will be leaving for his office,” Uy said.

 

Uy said the board told him that they will meet April 21 to decide which IPP to choose.

 

The Artech official denied that money changed hands during the meeting at Tupas’ house and the April 21 meeting at Fine Rock Hotel in Iloilo City.

 

Uy’s denial contradicts the claims of Baldoza that he received money from Artech during the two meetings.

 

Baldoza initially implicated Tupas as the one who handed him the money. But he later modified that statement saying it was a female Artech employee who gave him an envelope containing P75,000 cash.

 

Baldoza said he wanted more time to study Artech’s offer because the comparative study of their Technical Support Department showed that the IPP’s generation rate of P8.per kilowatt-hour 56 is expensive compared to other power producers.

 

But Uy said their rates are lower compared to other IPPs that made offers to the Panay-Guimaras power consortium – P6.64 per kWh for the diesel plant and P5.90 per kWh for the biomass plant.

 

Artech will supply power to Ileco 3 from a diesel-fired power plant starting December 2010. Between 2010 and 2013, the firm will construct a 5-megawatt biomass plant which will operate as baseload power plant.

Ileco 3 management team urges NEA to suspend ‘bribed’ directors

 

By Francis Allan L. Angelo

 

SAYING they were ashamed with the issues hounding Iloilo Electric Cooperative (Ileco) 3, the management team asked the National Electrification Administration (NEA) to preventively suspend and probe the cooperative’s board of directors (BoD).

 

In a letter to NEA Administrator Edita Bueno dated May 11, 2009, the management team headed by Dory Jane Canones, Finance Services Department manager, asked the agency to investigate the alleged bribery of the BoD for the approval of the 25-year power supply deal with an independent power producer.

 

The alleged bribery happened twice, according to board president and former judge Mateo Baldoza – April 17 at the house of Governor Niel Tupas Sr. and April 21 during their special board meeting in Iloilo City.

 

Baldoza claimed receiving a total of P150,000 although he later retracted his first statement that Tupas gave him P75,000 at the latter’s house in Jaro, Iloilo City when they met with officials of Applied Research Technologies Phils., Inc. (Artech).

 

Presidential Assistant for Western Visayas and Ileco 3 director Rene Arandilla confirmed Baldoza’s first statement that the retired judge received money from Tupas and Artech.

 

Pending the investigation of the Ileco 3 board, the management team requested NEA to send a project supervisor and preventively suspend members of the board who were present in Tupas’ house to accept the alleged bribe.

 

Aside from Baldoza, also present in the meeting at the Tupas mansion in Jaro, Iloilo City were BoD vice president Emmanuel Pacardo, secretary Joy Fuentes, treasurer Asur Salcedo and Achilles Pama.

 

Those who did not show up were Arandilla and Vincent Frances Espinosa.

 

The management team said they were humiliated by the scandal that wracked the cooperative and sparked the ire of the consumers over the deal with Artech.

 

They said they were surprised with the indignation displayed by Ileco 3 consumers during a rally at the cooperative’s office in Sara, Iloilo last May 9.

 

“While our employees staged a black protest by wearing black shirts and black band during the coop’s annual general assembly meeting, we were not prepared for the indignation that the consumers showed during that day. We were never so ashamed in our life,” the letter said.

 

  1. The management team also hit the majority of the Ileco 3 board for their “vindictiveness, encroachment on otherwise purely management prerogatives and high-handed ways in dealing with coop employees who are perceived to be against them.”   

 

They also opposed the board’s designation of Aida Lamigo as permanent OIC because of her questionable competence and involvement in the missing P1million in Ileco 3 funds.

 

“We will do our share in bringing justice to those that betrayed our member-consumers. We will bring to your attention the pronouncements and the calls of alls sectors in our communities. We will try to rebuild the trust and confidence of everyone that took years to earn. Please help us find justice for Ileco 3,” the management team said.

 

Those who signed the letter were Ana Maria Bagsit, OIC assistant general manager; Engr. Antonio Lazarraga, Technical Services Department manager; Apolojandro Sicad, Sara Area Office manager; Lanie Velasco, Natividad Area Office OIC; Consorcia Peñaranda, Institutional Services Department manager; Cirilo Jerry Pacardo, Panian (Balasan) Area office OIC; and Engr. Raim Villarias, Ileco 3 Multipurpose Cooperative president.

 

Information from NEA said the board of administrators is deliberating on the management team’s letter before sending a three-man fact finding team to Iloilo.

By Francis Allan L. Angelo

 

THE management of Global Business Power Corp. (GBPC) told its detractors not to drag the firm in the Iloilo Electric Cooperative (Ileco) 3 bribery mess.

 

Engr. Adrian Moncada, GBPC vice president for commercial operations, said the company has nothing to do with the Artech mess. He was reacting to news items that Engr. Gil Altamira, GBPC commercial business manager, had something to do with the privilege speech of Board Member Rett Rojas calling for an investigation on the Ileco 3 issue.

 

Moncada said Rojas and Altamira are already friends even before the latter worked for GBPC.

 

He said Altamira is familiar with the operations of Ileco 3 and the bidding conducted by the Panay-Guimaras power consortium reason why Rojas asked inputs from him.

 

Moncada also disputed the claims of Iloilo provincial administrator Manuel Mejorada that GBPC and DMCI offered P7.36 per kilowatt hour to the Panay-Guimaras power consortium.

 

Mejorada claimed that GBPC-DMCI’s price was higher than the P6.64 per kilowatt hour proposed by Applied Research Technologies of the Philippines (Artech), Inc.

 

But Moncada said their offer to the consortium was P4.60 per kWh at 75% load factor. In the electricity industry, load factor is a measure of the output of a power plant compared to the maximum output it could produce.

 

Moncada said they did not offer P7.36 per kWh to the consortium.

 

“That figure of P7.36 per kWh is the assumption of the consortium’s technical consultant, not ours. The consultant assumed that we will use Newcastle bituminous coal in producing electricity. But we will use Semirara sub-bituminous coal which is cheaper. Our offer has always been P4.60 per kWh at 75% load factor which is the ideal industry standard,” Moncada added.

 

Moncada said that when the consortium leveled the load factor at 100%, similar to the offers of renewable energy firms, “our price will even go down to P3.98 per kWh.”

 

“Computing the price of electricity is not simple arithmetic. There are factors that must be considered before we can come up with the numbers. I suggest they check their facts,” Moncada said.

By Francis Allan L. Angelo

 

A MEMBER of Iloilo Electric Cooperative (Ileco-3) board of directors (BoD) confirmed the much-publicized bribery in the house of Governor Niel Tupas Sr. last April 17, 2009.

 

In his sworn affidavit dated May 13, 2009, Ileco 3 director Rene Arandilla said that on April 17, BoD president Mateo Baldoza told him that the board was summoned to a meeting with officials of Applied Research Technologies Phils., Inc. (Artech) in Tupas’ house at Brgy. MV Hechanova, Jaro, Iloilo City

 

“I called our board president through my cellphone and he confirmed the information and that he was about to go to the house of Governor Tupas in Iloilo City and I categorically told him that I am not going to the house of Governor Tupas for that meeting,” said Arandilla who represents the towns of Anilao and Banate to the Ileco 3 board.

 

After the meeting, Arandilla said Baldoza, a former court judge, told him that Tupas personally gave him P75,000 cash during the meeting.

 

Baldoza confirmed receiving money from Tupas in an interview with Joel Tormon of Aksyon Radyo-Iloilo last May 5.

 

The former judge said he received another envelope containing P75,000 from a female employee of Artech during their board meeting April 21, 2009 at Fine Rock Hotel in Iloilo City. The power supply deal with Artech was approved and inked on the same day.

 

Arandilla said that after the April 21 meeting, Baldoza showed him an envelope while saying “There is an ‘additional’.”

 

“I inquired what it was and he told me that it must be money given by a lady wearing black and out of curiosity and with his consent, I counted the money inside the envelope and determined to be containing P75,000 allegedly coming from Artech,” Arandilla said.

 

Arandilla said Baldoza told him to get P10,000 because he will give the rest of the money to the Church but the former refused. “Finally, he told me that only myself and his wife knew about this (money).”

 

The money is believed to be linked to the 25-year power supply agreement between Artech and Ileco 3. 

 

Arandilla’s statement corroborates the claim of Dr. Raul Banias, presidential assistant for Western Visayas, that Baldoza told him about the money Tupas gave the board president.

 

Banias said that even before the April 17 meeting, Baldoza confided to him that Tupas was pressuring the board to approve and sign the deal with Artech.

 

Banias said Baldoza volunteered the same information to other persons such as former board member Victorino “Dagul” Salcedo II and former Ileco 3 general manager Gil Altamira.

 

“These people confirmed that Judge Baldoza told them about the alleged bribe and pressures,” Banias said.

 

Baldoza, however, retracted his statement in another interview saying a lady from Artech and not Tupas gave the money to him at Tupas’ house.

 

Ileco 3 legal officer Edison Belloga had denied the alleged bribe in the deal with Artech.

 

Arandilla and Baldoza resisted the power supply agreement because Artech’s generation charge is the most expensive compared to other independent power producers (IPPs) that joined the bidding called by the Panay-Guimaras power consortium.

 

It was learned that Arandilla is a retired public school principal.

 

WHAT BRIBE?

 

In an interview with Febe Morales of Aksyon Radyo, Artech president Reynaldo Uy denied greasing the Ileco 3 board.

 

Uy said he met the Ileco 3 board at Tupas’ house last April 17 upon the invitation of director Asur Salcedo.

 

Uy said he has been presenting his company’s proposal to the Ileco 3 board since January 2009. During those presentations, the management team was also present and queried the executive about the deal.

 

Artech proposed to first construct a 6-megawatt diesel-fired power plant within 2010.

 

Once the diesel plant is completed, Artech will put up a 20MW biomass power plant which will be completed in 2010. The IPP will use sorghum as feedstock of the biomass plant.

 

Uy said he sensed that the management team was biased to other IPPs that will invest in Iloilo.

 

The Artech president said he laced the deal with a provision to build and turnover to Ileco 3 a P40-million power substation 25 years after the implementation of the supply agreement.

By Tara Yap

 

A MUNICIPAL councilor believes that the board of directors (BOD) of Iloilo Electric Cooperative (Ileco) are planning something drastic for the cooperative.

 

Ajuy municipal councilor Pepe Baterna disclosed that Ileco 3 BOD is eyeing for the conversion of Ileco 3 from an electric cooperative (EC) under the National Electrification Administration (NEA) to the Cooperative Development Authority (CDA).

 

Baterna said that consumers and stakeholders have to be wary of this proposal.

 

Presently, Ileco 3 is subject to NEA’s rules and regulations, especially in the appointment of a general manager and its decisions have to undergo proper review by NEA.

 

However, Baterna said that under CDA, member-owners are empowered through the BOD to hire and remove officers without any review from regulating authorities on new decisions and policies set by the BOD.

 

“This means the member-owners are very powerful.  They can hire or terminate employees without any hassle,” Baterna told The Daily Guardian.

 

Baterna warned that member-owners can manipulate as they are duly given more power than ever.

 

Baterna, on the other hand, did not dismiss the advantages of CDA registration.

 

Under NEA, Ileco 3 is presently a non-profit and non-stock organization.  But if it undergoes conversion, member-consumers who have paid a minimal fee and contributed to the share of the capital are duly recognized owners of Ileco 3.

 

Conversion to CDA will also pave way to tax exemptions and privileges for Ileco 3.

 

Other advantages of CDA conversion include member-owners having wider participation in decision making, sourcing of additional capital and equipment by Ileco 3 itself and without the consent of NEA, management is accountable to member-consumers and not only answerable to NEA, and provides patronage refund and interest on share capital granting there is net surplus.

 

“CDA conversion is very promising,” Baterna added.

 

Meanwhile, Baterna is calling all Ileco 3 consumers in Fifth District to unite against the alleged anomalous deal Ileco 3 entered with Applied Research Technologies Philippines Inc. (Artech).

FOR SALE A consumer holds placards denouncing the Ileco 3 board during an indignation rally in Sara, Iloilo Saturday. (Photo by Tara Yap)

FOR SALE A consumer holds placards denouncing the Ileco 3 board during an indignation rally in Sara, Iloilo Saturday. (Photo by Tara Yap)

By Francis Allan L. Angelo

 

THE National Electrification Administration (NEA) can boot out the entire board of directors of an electric cooperative (EC) if there is proof of their mismanagement and conduct unbecoming.

 

Engr. Wilfred Billena, Iloilo Electric Cooperative (Ileco) 1 general manager and NEA board member, said NEA’s power to supervise and control ECs is imbued in Presidential Decree No. 1645.

 

Section 10 of the decree empowers NEA “to issue orders, rules and regulations and motu-propio or upon petition of third parties, to conduct investigations, referenda and other similar actions in all matters affecting said electric cooperatives.”

 

If the electric cooperatives fail to comply with NEA edicts after due notice, NEA can “take preventive and/or disciplinary measures including suspension and/or removal and replacement of any or all of the members of the Board of Directors, officers or employees of the cooperative.”

 

In the case of Ileco 3 and its controversial 25-year power supply agreement with Applied Research Technologies Phils., Inc. (Artech), Billena said consumers should file a complaint with NEA.

 

“As soon as we receive the complaint, we will verify it and conduct an investigation to give due process to parties involved,” Billena said.

 

In a text message to The Daily Guardian, NEA Administrator Edita Bueno said they will address the Ileco 3-Artech deal if her office receives a complaint.

 

Ileco 3 board president Mateo Baldoza and member Rene Arandilla questioned the deal saying Artech’s generation charge of P8.56 per kilowatt-hour is expensive compared to the offers of other independent power producers (IPPs) in a bidding conducted by the Panay-Guimaras power consortium.

 

Artech’s offer is seen to jack up Ileco 3’s rate from P6 per kWh to P12 per kWh.

 

Artech did not join the consortium’s bidding and instead made an unsolicited offer to Ileco 3 to put up a diesel-fired power plant and a biomass plant.

 

Baldoza had alleged that he received P75,000 from Governor Niel Tupas Sr. during a meeting with Artech officials in the governor’s house in Jaro April 17.

 

Baldoza also received last April 21 another envelope from an Artech employee with the same amount of money during the Ileco 3 board special meeting in Iloilo City. The Artech deal was approved and signed during the same meeting.  

 

But Baldoza later changed his statement by denying that Tupas handed him the money at the latter’s mansion. He said a female employee of Artech gave the money to him.

 

Tupas had denied Baldoza’s allegations saying he only arranged for the meeting. The governor said he only wants to secure the power requirements of Ileco 3 by inviting more IPPs.

 

Billena said he found it irregular for Ileco 3 to accept Artech’s offer outside a competitive bidding process.

 

“Under the rules of the Energy Regulatory Commission (ERC), procurement of power should be done through competitive bidding unless there are no other choices. The contract between Ileco 3 and Artech will undergo ERC review and approval and I believe the commission will protect the consumers,” Billena said.

 

Billena said the technical services department of the cooperative must first examine the contract to find out if the analyses and assumptions are correct.

 

“The management side is very important in the deliberation of the contract because it will go over the contract on technical matters. The contract might result in oversupply which might burden the consumers,” Billena added.

 

Public hearings and consultations with stakeholders must also be conducted before the cooperative can enter into an agreement.

 

ERC Commissioner Rauf Tan earlier said distribution utilities and cooperatives are responsible for contracting enough and affordable electricity for their consumers.

 

A competitive process must be observed in tapping sources of power, Tan said in an interview with The Daily Guardian.

 

More than 1,000 Ileco 3 consumers trooped to the cooperative’s office in Sara, Iloilo Saturday to call for the revocation of the deal with Artech.

 

Ileco 3 covers the towns of Anilao and Banate in the 4th district and Barotac Viejo, San Rafael, Lemery, Ajuy, Concepcion, Sara, San Dionisio, Batad, Estancia, Balasan and Carles in the 5th district.

 

Dr. Raul Banias, presidential assistant for Western Visayas and former Concepcion mayor, said he will write NEA, ERC and the Department of Energy regarding the Ileco 3-Artech agreement.

 

The local government units under Ileco 3 will also pass their respective resolutions calling for the revocation of the deal.

 

“I am also a consumer and I will be affected if this agreement pushes through. I am disappointed with the Ileco 3 board for its act,” Banias said.

 

Atty. Edison Belloga, Ileco 3 legal counsel, defended the agreement saying only Artech can provide electricity after the EC’s power supply agreement with the National Power Corp. next year.

 

Belloga said Artech’s proposed biomass plant will benefit consumers as it will drive down prices of electricity. The proponent will also establish a sorghum plantation to sustain the plant’s fuel.

 

“The plantation will put to good use idle lands in the 5th district and provide employment to the consumers,” Belloga said.

By Francis Allan L. Angelo

 

GOVERNOR Niel Tupas Sr. was seething with anger when he heard the allegations that he bribed the Iloilo Electric Cooperative (Ileco) 3 board of directors to sign a power supply agreement with an independent power producer (IPP).

 

Tupas also hit former judge Mateo Baldoza, Ileco 3 board president, for implicating him the alleged bribery in the cooperative’s agreement with Applied Research Technologies Philippines, Inc., (Artech).

 

Baldoza had repeatedly said in a live interview with Joel Tormon of Aksyon Radyo that Tupas gave him an envelope containing P75,000 during a meeting with Artech top honchos April 17 in the governor’s house in Jaro.

 

Baldoza later contradicted himself saying a woman from Artech gave the envelope while he was in the sala of Tupas’ house.

 

Pagkabati ko sina gina-ugtum ko lang ang akon kaakig (I checked my anger when I heard the news) because I believe that the truth will come out. And the truth is that I did not give money to him (Baldoza),” Tupas said.

 

Tupas said it was only Baldoza who was claiming that he received money from Artech while the other board members denied being bribed.

 

“Of all the board members, he is the only one saying that he was bribed. Who will you believe then?

 

While he was responsible for the creation of Ileco 3, Tupas said he has no personal interest in the cooperative except to secure stable and cheap power supply for consumers.

 

“Next year we will suffer brownouts already so we need more plants. The more power plants we have, prices of electricity will be cheaper because of competition. Whoever can supply power to Ileco 3 is welcome. There are no favors, no relations and no money involved here,” Tupas said.

 

PROBE

 

During the regular session of the Sangguniang Panlalawigan Tuesday, 5th district Board Member Jett Rojas called for an investigation on the Ileco 3-Artech deal.

 

In a privilege speech, Rojas, who hails from Ajuy which is part of Ileco 3 franchise, said the deal is a big sellout of the consumers as it will tie them to high power rates offered by Artech.

 

The board member said Artech’s generation charge of P8.56 per kilowatt-hour is expensive for the consumers.

 

“This contract will result in 100% increase in electricity bills. If consumers are presently paying P100 per month, it will increase to P200 per month when the agreement takes effect,” Rojas said.

 

Vice Governor Rolex Suplico said Rojas’ measure was referred to the committee on economic enterprises and investments chaired by Board Member Arthur Defensor Jr.

 

Suplico said they will conduct an out-of-town session and committee hearing May 19 in Sara, Iloilo. The venue for the hearing and session could either be at the session hall of Sara municipal board or the Ileco-3 office.

 

Suplico said they are looking for the signed copy of the contract since all they have is a draft copy.

 

He cited Section 3 of the contract which requires approval of the Iloilo provincial government before the deal can be implemented.

 

“It is a standard practice that each party to an agreement should have signed copies of the contract to avoid alterations in the document. But Ileco 3 only has a draft copy,” Suplico said.

 

Suplico said the contract was silent on the feedstock of the biomass plant Artech is proposing to construct.

 

“What kind of biomass plant is that? What is the fuel? Grass, trees or what? If there will be a plantation for the feedstock, where it will be located? How big is the area?” he said.

 

Ileco 3 legal officer Edison Belloga said Artech will first construct a 6-megawatt diesel-fired power plant in 2010. Once the diesel plant is completed, Artech will put up a 20MW biomass power plant which will be completed also in 2010. The IPP will use sorghum as feedstock of the biomass plant.

 

CAUTION

 

In a statement, Iloilo provincial administrator Manuel “Boy” Mejorada urged the public to be more “discerning” over the Ileco 3-Artech power supply agreement.

 

Mejorada said the controversy is a “big demolition job” for political and business purposes.

 

“There are big forces behind this move, and it is obvious the targets are Governor (Niel) Tupas and the much-coveted power supply agreement with a big cooperative,” Mejorada said.

 

Mejorada said Rojas speech’s is part of a “grand scheme” to misinform the people about the transaction and portray Tupas as “having sold out the interests of his constituents” to Artech.

 

He said the offer of Artech is a two-step scheme in which the power company will build a diesel-fired plant to operate before December 2010 when the existing PSA of Ileco III with the National Power Corp. (Napocor) ends, and then shift to biomass technology two or three years later its plant for the purpose is completed.

 

“The P6.50 per kilowatt hour of generation cost applies only to the diesel-fired power supplied by Artech,” Mejorada said.

 

Once the biomass-fueled plant becomes operational, Artech will charge only P5.90 per kilowatt hour for the electricity it generates, he said.

 

He said the electric cooperative’s need to sign a PSA with a reliable supplier is “more urgent” because Napocor will stop its supply of power by December 2010, or about 19 months from now.

 

Mejorada said the “bidding” conducted by the consortium of electric cooperatives in Panay and Guimaras is not binding on them.

 

“The consortium is a loose aggrupation formed as a bargaining leverage in getting proposals from interested companies,” he said.

 

Mejorada added that the PSA is not even a perfected contract yet, as it will have to undergo scrutiny by the Energy Regulatory Commission (ERC).

 

He described the legislative investigation sought by Rojas as “a waste of time and energy.”

Ileco 3 consumers stage an indignation march and rally at the Sara office of Ileco 3. (Photos by Tara Yap)

Ileco 3 consumers stage an indignation march and rally at the Sara office of Ileco 3. (Photos by Tara Yap)

 

Presidential Assistant for Panay Raul Banias and former Sangguniang Panlalawigan member Victorino Salcedo question Baldoza who claimed he received money from Artech. Banias would later walk out from the dialogue.

Presidential Assistant for Panay Raul Banias and former Sangguniang Panlalawigan member Victorino Salcedo question Baldoza who claimed he received money from Artech. Banias would later walk out from the dialogue.

 

Former judge Mateo Baldoza

Former judge Mateo Baldoza

 

 

Banias confirms Baldoza told him about Artech bribe

 

By Francis Allan L. Angelo and Tara Yap

 

AS EARLY as Holy Week, Presidential Assistant for Western Visayas Raul Banias had already learned that the Iloilo Electric Cooperative (Ileco) 3 board of directors was being pressured to strike a deal with an independent power producer (IPP).

 

Banias said he first got wind of the controversial deal between Ileco 3 and Applied Research Technologies Phils., Inc. (Artech) from board president Mateo Baldoza. 

 

“During Holy Week, I received a text message from Judge Baldoza informing me that Governor Niel Tupas is calling the board to a meeting at the governor’s house. He also told me that they were being pressured to accept Artech’s proposal,” Banias said over cable TV program, Serbisyo Publiko hosted by Councilor Perla Zulueta Sunday morning.

 

Banias said Baldoza told him last May 1 about the meeting at Tupas’ house in Jaro, Iloilo City April 21 and the money Baldoza initially claimed to have received from the governor. Two Artech officials – president Reynaldo Uy and vice president Domingo Beltran – were present in the meeting.

 

The retired judge also recounted another envelope filled with cash was given to him last April 21 during a special board meeting in a hotel in Iloilo City.

 

Banias said Baldoza volunteered the same information to other officials and personalities in the 5th congressional district.

 

Last May 5, Baldoza told Aksyon Radyo anchorman Joel Tormon that Tupas gave him an envelope containing P75,000 while saying “Buligan ta lang sila (Let’s help them).”

 

Baldoza said the money may have something to do with the Artech deal which he questioned because of its exorbitant generation charge of P8.56 per kilowatt-hour.

 

But Baldoza contradicted himself in another interview saying a woman from Artech gave the money at Tupas’s house, not the governor.

 

Tupas also denied bribing Baldoza although he confirmed the meeting at his mansion. The governor said he favors the agreement with Artech because the IPP can provide power when Ileco 3’s power supply deal with the National Power Corp. expires next year.

 

Banias said he pities Baldoza, whom he described as an honest and forthright person.

 

“Judge Baldoza is a person of high integrity and probity. Maybe he was guilt-stricken reason why he volunteered the information to me, to other personalities and the media to assuage that guilt. I don’t know why he recanted his statement. If he changed his story, then his credibility is in question,” Banias added.

 

More than 1,000 consumers led by Banias, provincial Board Members Jett Rojas, former board member Victorino Salcedo II, Mayors Ermelita Salcedo of Sara, Elizabeth Salcedo of Concepcion and other local officials held an indignation rally at the Ileco 3 office in Sara while the board was in a meeting.

 

The protesters carried placards denouncing the power supply agreement with Artech and the alleged bribe given to Ileco 3 officials.

 

One placard asked: “Gov. Tupas ngaa ginbaligya mo kami? (Gov. Tupas why did you sell us)?” Another said: “Ileco 3 for sale P150,000 per director for inquiries just contact ARTECH.”

 

Buligi lang da sila ari ang P75,000,” said another placard.

 

The protesters also hanged a streamer at the gates of Ileco 3 compound in Brgy. Preciosa, Sara condemning the power supply agreement with Artech.

 

A dialogue was later held between the Ileco 3 board and local officials to discuss the issues.

 

Banias, Rojas and the mayors queried Baldoza on the alleged bribe but the latter stuck to his latest pronouncements that Tupas did not bribe him. He also said that the money was not meant to favor Artech.

 

“It’s not a bribe. We gave it to the Knights of Columbus because it’s for charity,” Baldoza said during the dialogue.

 

But Banias said he noticed that Baldoza, who is a member of the Knights of Columbus, was shaking and visibly disturbed while denying that the governor was involved.

 

All municipal governments under the Ileco 3 franchise are planning to pass resolutions opposing the 25-year power supply agreement with Artech.

 

Copies of the resolutions will be given to Ileco 3, National Electrification Administration, and the Energy Regulatory Commission and Department of Energy, Banias said.

Ileco 3 consumers nix Artech deal

 

By Francis Allan L. Angelo

 

DISTRIBUTION utilities (DUs) and electric cooperatives (ECs) must make sure that their consumers enjoy ample power supply at the cheapest cost, according to an Energy Regulatory Commission (ERC) official.

 

Rauf Tan, ERC commissioner, said these responsibilities of power utilities are embodied in the Electric Power Industry Reform Act (Epira) of 2001.

 

“In the Epira, the distribution utilities must look for the cheapest possible source of electricity for the end consumers,” Tan told The Daily Guardian.

 

Tan was reacting to the controversial 25-year power supply agreement between Iloilo Electric Cooperative (Ileco) 3 board of directors and Applied Research Technologies Phils., Inc (Artech).

 

Tan and fellow ERC commissioner Jose Reyes arrived in Iloilo City to conduct a hearing on the petition of Panay Electric Co. (Peco) and Panay Power Corp. regarding the latter’s asset recovery scheme.

 

The ERC officials said Peco and Ilecos 1, 2 and 3 must secure the energy needs of their consumers.

 

How will power distributors go about this?

 

“The utilities should ensure that they have enough power supply contracts to meet the requirements of their customers. They must undergo a competitive process which is expected to result in competitive prices (of power),” Tan said, apparently referring to the bidding process.

 

Under the Epira, all power supply contracts must be submitted to the ERC to establish the pricing mechanism and approval.

 

Tan said Ileco 3 will have to divulge to the commission the process it used to come up with the agreement with Artech.

 

“Ileco 3 will have to answer for that as they must show that the agreement is cost effective,” he added.

 

The Ileco 3 management headed by Dory Joy Canones, Financial Services Department head, assailed the Artech deal because it will drive up the price of electricity by 100%, from P6 per kilowatt-hour (kWh) to P12 per kWh.

 

Canones also claimed the management team was not involved in the approval and signing of the agreement.

 

Ileco 3 board president Mateo Baldoza and member Rene Arandilla also questioned the deal because Artech’s generation charge of P8.56 per kWh is higher compared to other IPPs.

 

A study of Ileco 3’s Technical Services Department showed that Global Power’s generation charge is only P4.82 per kWh, Asea One (P5.90 per kWh) and DMCI (P6.60 per kWh).

 

Artech did not join the bidding conducted by the Panay-Guimaras power consortium but made an unsolicited offer to Ileco 3.

 

Baldoza also claimed receiving P150,000 cash from Governor Niel Tupas Sr. and an Artech employee prior to the approval of the agreement.

 

Baldoza later contradicted himself when denied receiving money from Tupas who also denied the allegation.

 

PROBE

 

The National Electrification Administration (NEA) will investigate Ileco 3’s deal with Artech.

 

Percy Crisostomo, head of NEA’s Industrial Relation Development Department, said they will ask the Ileco 3 board to explain why it approved and signed the deal sans approval from NEA.

 

Crisostomo said the Ileco 3 board should have sought NEA’s approval first before signing the agreement with Artech.

 

NEA provides financial, institutional and technical assistance to ECs.

 

Crisostomo said the cooperative’s management team must be involved in negotiations for power supply agreements “because it will implement the policies and decisions of the board.”

 

The bidding process in power supply purchases is also important to ensure that electricity rates are beneficial to the consumers, Crisostomo said.

 

“The bidding will help the cooperative determine which offer from power producers is most beneficial to the clients. The consumers must also be consulted to get their stand on the agreement,” he added.

 

GATHERING STORM

 

Consumers and leaders of towns under Ileco 3 franchise are set to meet and decide on how to oppose the cooperative’s supply agreement with Artech.

 

Ileco 3 covers the towns of Anilao and Banate in the 4th district and Barotac Viejo, San Rafael, Lemery, Ajuy, Concepcion, Sara, San Dionisio, Batad, Estancia, Balasan and Carles in the 5th district.

 

Mayor Elizabeth “Besty” Salcedo said they are disappointed with the deal because Ileco 3 did not consult their constituents before approving the deal.

 

“There was no general assembly or hearing called on this mater. They should have consulted the consumers first,” Salcedo said.

 

Salcedo said she has been calling other mayors in the 5th district to discuss the issue.

 

“I will join the decision of other leaders to move against Ileco because we have to protect the interest of our people who are also consumers,” she said.

 

Earlier, Presidential Assistant for Western Visayas Raul Banias called for the revocation of the Ileco 3-Artech deal.

 

Banias said many leaders are disappointed with the decision of Ileco 3 to strike a deal with the independent power producer.

By Francis Allan L. Angelo

 

THE board of directors (BoD) of Iloilo Electric Cooperative (Ileco) 3 should revoke its power supply agreement (PSA) with an independent power producer (IPP), according to Presidential Assistant for Western Visayas Raul Banias.

 

Banias, the former mayor of Concepcion, Iloilo which is under Ileco 3 franchise, said consumers of the cooperative called him to express their indignation against the 25-year deal the Ileco 3 board signed with Applied Research Technologies Phils., Inc. (Artech).

 

Ileco 3 covers the towns of Anilao and Banate in the 4th district and Barotac Viejo, San Rafael, Lemery, Ajuy, Concepcion, Sara, San Dionisio, Batad, Estancia, Balasan and Carles in the 5th district.

 

“Many officials and consumers in the 5th district called me upon learning of the issue to express their disappointment and discontentment with the actions of Ileco 3 directors. I am also a consumer of Ileco 3 because I live in Concepcion and this agreement, if ever it is disadvantageous, will also affect me. Almost all of them are against the agreement,” Banias said.

 

Banias said the Artech deal should be revoked if it will burden Ileco 3 consumers with higher electricity rates.

 

Allegations of bribery have tainted the deal, the more reason why the board should revoke the agreement, Banias added.

 

Banias said he intends to write the Ileco 3 board and other government agencies regarding the issue.

 

“I am still gathering more information on this issue. The moment we find out that this contract is disadvantageous, I will write the board, Department of Energy (DoE), Energy Regulatory Commission (ERC) and National Electrification Administration (NEA) to express my sentiments. I am also consulting my lawyer so my letter will have legal basis,” Banias said.

 

If the alleged bribery by Governor Niel Tupas Sr. and Artech is proven, Banias said the Ileco board does not deserve to stay in office.

 

Banias also lauded Ileco board president Mateo Baldoza for divulging the alleged bribery.

 

“I am happy with his revelations. I know Judge Baldoza because he is related to me. I know his integrity and his probity is beyond doubt. He stood up for the consumers by exposing this alleged bribery,” Banias.

 

Baldoza earlier claimed that Tupas handed to him an envelope containing P75,000 cash during a meeting with Artech officials at the governor’s house April 17.

 

Another P75,000 cash was given to him by an Artech employee in a hotel in Iloilo City during the signing of the PSA April 21.

 

But Baldoza made a complete turnaround, contradicting himself in later media interviews. He said it was a female Artech employee, not Tupas, who handed the first cash-filled envelope.

 

Baldoza said he made a mistake in his first interview with Aksyon Radyo-Iloilo where he tagged Tupas in the alleged bribery.

 

Aside from Baldoza, Ileco 3 director Rene Arandilla and the management team headed by Dory Joy Canones questioned the deal because of Artech’s expensive generation charge of P8.56 per kilowatt-hour.

 

A study by Engr. Antonio Lazarraga, Technical Services Department manager of Ileco 3, showed that Artech’s price per kWh is higher than Global Power (P4.82 per kWh), Asea One (P5.90 per kWh) and DMCI (P6.60 per kWh).

 

Artech’s rates will increase Ileco 3’s charged by 100%, from P6 per kWh to P12 per kWh.

 

Canones said they will question the deal with NEA which regulates electric cooperatives.

 

Anilao Mayor Ma. Teresa Debuque, meanwhile, said they might transfer to Ileco 2 if Ileco 3 insists on the Artech deal.

 

Debuque said she asked officials of other electric cooperatives if they can move out of Ileco 3 franchise.

 

“It would take congressional action if we move out of Ileco 3 because the franchise is approved by Congress. I asked the Sangguniang Bayan to pass a resolution condemning the deal because it will jack up electricity rates by 100%,” Debuque said.

BRIBERY? Iloilo Governor Niel Tupas Sr. allegedly gave cash to Ileco 3 directors inside his mansion in Jaro, Iloilo City. (Photo by Tara Yap)

BRIBERY? Iloilo Governor Niel Tupas Sr. allegedly gave cash to Ileco 3 directors inside his mansion in Jaro, Iloilo City. (Photo by Tara Yap)

By Francis Allan L. Angelo

 

“BULIGAN ta lang sila (Let’s help them).”

 

These words and an envelope filled with cash are what former Judge Mateo Baldoza, president of the Iloilo Electric Cooperative (Ileco) 3 Board of Directors (BoD), got when he went to the house of Iloilo Governor Niel Tupas Sr. at MV Hechanova, Jaro Iloilo City last April 17, 2009.

 

The alleged bribery is being linked to the controversial 25-year power supply agreement (PSA) of Ileco 3 with independent power producer (IPP) Applied Research Technologies Philippines, Inc (Artech).

 

The PSA is being questioned by two Ileco 3 directors because Artech’s generation cost is higher than the offers of other five IPPs that joined the bidding conducted by the Panay-Guimaras Power Supply Consortium (PGPSC) last year.

 

Aside from Baldoza, also present in the meeting at the Tupas mansion were BoD vice president Emmanuel Pacardo, secretary Joy Fuentes, treasurer Asur Salcedo and Achilles Pama.

 

Those who did not show up were BoD members Rene Arandilla and Vicent Frances Espinosa.

 

“We were called one by one in one of the rooms inside the house. When it was my turn, Governor Tupas handed me an envelope while saying ‘Let’s help them’. I did not open the envelope until I got home. It was my wife who opened the envelope and found P75,000 cash inside,” Baldoza said in an interview with broadcast journalist Joel Tormon over Aksyon Radyo-Iloilo yesterday.

 

Baldoza said he also saw at Tupas’ house two Artech top honchos – company president Reynaldo Uy and vice president for marketing and business development Domingo Beltran.

 

Baldoza said he has no knowledge if the other BoD members also received cash “because we were called individually.”

 

Another envelope containing P75,000 cash was handed to the directors during the approval and signing of the Artech supply contract at Fine Rock Hotel in Iloilo City April 21, he said.

 

When asked if the money could be linked to the Artech deal, Baldoza said it might have something to do with the PSA because of the presence of Artech officials during the April 17 meeting.

 

“I did not touch or spend the money because I cannot accept it. The money is still intact and I intend to give it to the Catholic Church’s charity program,” Baldoza said.

 

DENIAL

 

In an interview with Aksyon Radyo, Tupas said he summoned the Ileco 3 board to a meeting in his house April 17 but no money changed hands.

 

Tupas said Uy presented their proposal to the Ileco 3 board during the meeting.

 

The governor said he favors the contract between Artech and Ileco 3 because of the power crisis in the province.

 

“The other power producers will operate in 2011 yet while Artech can supply immediately. I am more concerned with the supply because of the brownouts. When the other producers are done with their power plants, electricity rates will go down because of competition,” Tupas said. 

 

WHAT’S THE DEAL?

 

Based on documents obtained by The Daily Guardian, the controversy started when PGPSC, which is composed of seven electric cooperatives in Panay and Guimaras, solicited power supply bids from IPPs.

 

Five IPPs responded to the consortium’s solicitation – Global Power, DMCI, ASEA One, Global Green and PETROXY.

 

Artech did not join the solicitation and bidding but it submitted an unsolicited offer for consideration of the Ileco 3 board.

 

The board tasked Engr. Antonio Lazarraga, Technical Services Department manager of Ileco 3, to make a simulation and comparative study of Artech’s proposal with that of other IPPs.

 

Artech offered to operate a diesel-fired power plant and a biomass plant to generate electricity.

 

The study showed that Artech’s generation cost of P8.56 per kilowatt-hour was the highest compared to the rates offered by the other IPPs.

 

Global Power offered the lowest price at P4.82 per kWh, Asea One – P5.90 per kWh and DMCI – P6.60 per kWh.

 

Lazarraga submitted his study to the Ileco 3 board April 16. The following day, the directors were summoned to Tupas’ house where the alleged bribery happened.

 

Four days later, the board approved and signed the PSA with Artech despite the reservations expressed by Baldoza and Arandilla.

 

Baldoza said he wanted the board to study Artech’s price for 60 days because it would result in higher electricity bills for Ileco 3 consumers.

 

Ileco 3 covers the towns of Anilao, Banate, Barotac Viejo, San Rafael, Lemery, Ajuy, Concepcion, Sara, San Dionisio, Batad, Estancia, Balasan and Carles.

 

Ileco 3 consumers are presently paying P6 per kWh but if the cooperative starts drawing power from Artech, the rates will increase by 100% to P12 per kWh inclusive of distribution charges.

 

“Artech’s technology is good. But I had reservations because the power will be produced by a diesel power plant which is more expensive. The biomass plant will only kick in three years later. I asked the board to study the pricing and synchronize it with other cooperatives but we were outnumbered in the board,” Baldoza said.

 

Arandilla echoed Baldoza’s sentiments saying Artech’s rates will jack up prices of electricity in their franchise area.

 

“I also asked the board to study the offer for 60 days because we don’t want to burden our consumers with high prices of electricity. But two weeks after, the board approved the offer and contract with Artech,” Arandilla said.

 

Arandilla said Baldoza informed him about the April 17 meeting at the Tupas mansion but he did not attend because of a prior appointment.

IBC supports move to exempt power from VAT

 

By Francis Allan L. Angelo

 

THE Iloilo Business Club (IBC) is planning to come up with a statement supporting the proposal to scrap the value added tax (VAT) on electricity.

 

The plan was broached by businessman Herminio Maravilla, former IBC chair and incumbent Board of Trustees member, during the Power 101 forum at Hotel del Rio Friday last week.

 

IBC executive director Lea Lara said the club’s board and officers will discuss the manifesto in their next membership meeting on the first week of May.

 

The statement will basically rally behind the proposal of Senate president Juan Ponce-Enrile to scrap VAT on power.

 

“The specific contents of the statement will be discussed during the meeting. It will definitely be a big help to the business community and other consumers if VAT is removed from our electricity rates. As we all know, the city is having a hard time attracting investors because of high and unstable power rates,” Lara said.

 

Engr. Randy Pastolero, special assistant to Panay Electric Co. (PECO) president Miguel Cacho, said they welcome the move of the IBC to call for the exemption of electricity from VAT charges.

 

Pastolero said 11% of the total production cost of electricity per kilowatt goes to VAT.

 

“PECO does not earn from VAT because we just remit it to the government. If VAT on electricity is scrapped, we can enjoy some P1.10 reduction in our power bills,” Pastolero said.

 

Pastolero said PECO will also benefit from the club’s move “because it would be easier to collect from our clients if their monthly bills are reduced.”

 

Earlier, Federation of Filipino-Chinese Chambers of Commerce and Industries, Inc. (FCCCII) president Alfonso Uy said solving the unstable and expensive power supply in Iloilo City will help propel its economy.

 

Uy said they are batting for the construction of cheap source of power such as the 164MW coal-fired power plant project of Global Business Power Corp. (GBPC) in LaPaz, Iloilo City.

BRIGHT SPOT Iloilo Gov. Niel Tupas Sr. stresses Iloilo role as an IT investment destination during the investment forum of the Iloilo Information Technology Week at Amigo Terrace Hotel Tuesday. Listening are (L-R) Antonio Jon of ILED, Atty.  Giovanni Miraflores, Rex Drilon II of ILED, and Dr. Glenn Aguilar of IFIT.  (Photo by Tara Yap)

BRIGHT SPOT Iloilo Gov. Niel Tupas Sr. stresses Iloilo role as an IT investment destination during the investment forum of the Iloilo Information Technology Week at Amigo Terrace Hotel Tuesday. Listening are (L-R) Antonio Jon of ILED, Atty. Giovanni Miraflores, Rex Drilon II of ILED, and Dr. Glenn Aguilar of IFIT. (Photo by Tara Yap)

Iled now confident of promotional campaigns

By Francis Allan L. Angelo

SELLING the city and province of Iloilo to potential investors is a cinch with the looming construction of a coal-fired power plant in LaPaz, Iloilo City.

Rex Drilon II, Iloilo Economic Development Foundation president, said they will mount a major investment forum in Metro Manila late this year to push Iloilo to serious investors.

Drilon, the chief operations officer of Ortigas Co. and Limited Partnership, said they have been planning to mount the forum “but various problems, especially in the power sector, stopped us from going all-out.”

Drilon said the issuance of the environmental compliance certificate to two coal-fired power plants proposed by Global Business Power Corp. (GBPC) and DM Consunji, Inc. will put Iloilo in an attractive position in the eyes of investors.

“We can now go full steam ahead with our marketing efforts for Iloilo. With these two power plants combining for more than 200MW of power, we have more than enough and investors will surely flock the city and province,” Drilon said.

GBPC, the mother company of Panay Power Corp. which is the sole power supplier of Iloilo City, is the proponent of the coal-fired power plant at Brgy. Ingore, LaPaz.

DMCI is proposing to construct a similar plant in Concepcion, Iloilo.

During the IT Investment Forum at Amigo Terrace Hotel Tuesday, Arman Lapus, GBPC executive vice president for commercial, assured businessmen that their company will deliver the plant in 2010.

“Cheap and reliable power supply will be available in time for the projected boom in the information technology sector. With the issuance of the ECC, we can deliver the plant by end of 2010,” Lapus said.

September 2018
M T W T F S S
« Nov    
 12
3456789
10111213141516
17181920212223
24252627282930

Blog Stats

  • 223,857 hits

Top Clicks

  • None

Flickr Photos

Advertisements