A Humbling Experience

Prof. Lim of the Asian Institute of Management had asked me to join him with his lunch with Philippine National Oil Company Energy Development Corporation Chairman Paul A. Aquino. Of course, this is in line with the business case that I am helping him to write. As we all know, the said GOCC had been privatized on November last year and as a result is now owned by the Lopez Group of Companies. Reason why MERALCO has been facing hearings recently is that I would presume is because of the discreet transaction that had happened in the PNOC-EDC bid. Red Vulcan Holdings Corporation had the highest bid of 58.5 billion pesos to the 40% stake of the government on PNOC EDC. In early part of this year, the First Gen Company bought the minor shares of Red Vulcan taking final control of the said company. The series of events that succeeded the bid fumed the Senate since the Lopez's is already owning the MERALCO. A monopoly is shadowing. PNOC-EDC is the sole company in the country that has geothermal plants. It ranks as the world's second largest producer of geothermal energy, next to United States. Senator Joker Arroyo in his Senate privelege speech during the first regular session of the 14th Cogress said that the privatization measure of the executive department to restructure PNOC-EDC may create a "vacuum". He also said that while it would be privatized, the original mandate of the said geothermal drilling company must not be circumvented. It must remain that the prime purpose of PNOC-EDC is to explore and develop indigenous energy sources. He further said that the country is indeed losing leverage with the sale of government's stock on PNOC-EDC.

The intent of our lunch with Mr. Paul Aquino would be to know what Corporate Social Responsibilty Programs would be implemented by Vulcan Holdings in the communities of the geothermal plants. In a speech before the Management Association of the Philippines, Mr. Paul Aquino relates that PNOC-EDC is spending huge money for its CSR programs that directly benefitted the communities where the company's geothermal plant is located. Prior to that, CSR programs of PNOC-EDC are not much community-based. He started a more community-based approach when he experienced first hand PNOC-EDC's rig workers being killed and the community residents did not even bother to help. He decided that in places like Leyte and Negros, PNOC-EDC is the government.

With the sale of the government's PNOC-EDC to a private company, what is going to happen to the price of electricity or kuryente? Recently, my brother submitted a complaint to MERALCO because our usual P1,500 pesos of electric bill rose to 2,500 pesos in the two preceding months. We consumed 251 kilowatts every month! The complaint resulted to a new MERALCO meter being installed in our house. The reader is digital and it is a lot more convenient to read. With it you may know how much eletricity every appliance consume in the house! My personal computer for example has a range of 90 to 150 watts. Indeed, a laptop would save more energy than a PC. I just hope with the monopoly, our electricity consumption would not amount for more.