Business Groups oppose HB 8179 or the Granting of Nationwide Franchise to ‘Solar Para Sa Bayan’
 
As of September 19, 2018
 
 
We strongly oppose the passage of House Bill (HB) 8179 or the granting to one firm unlimited, monopolistic control of an important sector of our society. It is in conflict with the overarching policy of our nation being a free, open, fair economy. We are at a loss to know why it was even considered.
 
With over 5 Million Filipinos still living without electricity and with the increasing impact of climate change, there is absolutely no justifiable reason for our policymakers and legislators to restrict the expanding renewable energy industry from developing solar, wind, hydro and biomass as sources of energy that will bring light to missionary areas throughout the country.
 
Unfortunately, HB8179 proposes to grant one entity – Solar Para Sa Bayan - the right to establish a monopoly that will engage in the entire electric power value chain (generation, transmission, distribution and supply) with no limitation as to the capacity of the systems it can install or the service area it will cover.
 
In fact, HB8179 grants the right to access any transmission or distribution system without any reciprocal obligation on its part, specifically compliance to existing and relevant laws and rules. It is noteworthy to cite that no franchise obligation, during its franchise term, is imposed uponSolar Para Sa Bayan to ensure full electrification for all.
 
Moreover, despite all fiscal and tax incentives provided in the Proposed Franchise, there is nothing in HB8179 that regulates the activities ofSolar Para Sa Bayan. There are no impositions on performance or service requirements that would ensure the achievement of its objective to provide electricity in un-served and un-energized localities. More alarming is the provision exempting Solar Para Sa Bayan from the regulatory powers of the Energy Regulatory Commission (ERC).
 
We support the Philippine Rural Electric Cooperatives Association (PHILRECA), Philippine Electric Plant Owners Association (PEPOA), and MERALCO in their opposition to HB8179 as it violates the constitutional provision of fair and equal treatment for all.
 
We are committed to sustainable development through the expanded use of renewable energy (RE). We are deeply troubled and alarmed by HB8179 because it effectively grants a monopoly and exempts one private company from the rules of competition and oversight provided under the Electric Power Industry Reform Act (EPIRA) and the RE Act.
 
We believe there is no legal necessity to grant Solar Para Sa Bayan a nationwide franchise since there are existing regulatory framework allowing any entity – whether private or public, including LGUs and NGOs - to participate in the provision of electricity in un-served or un-energized areas.
 
The EPIRA already lays down the legal requirements for any entity to participate in the generation and supply sectors.  All generators and suppliers of electricity in contestable markets do not need any national franchise. The supply rules already in place provide that the prices to be charged by suppliers are not subject to the regulation of the ERC. 
 
Additionally, the EPIRA covers un-served and missionary areas, specifically allowing Qualified Third Parties (QTP) to supply and distribute electricity to un-energized communities. True, there are flaws and weaknesses in the implementing rules of the QTP. But, killing competition and creating a monopoly is not the answer. What is needed is to improve existing rules and streamline the processes in the application for QTP.
 
Solar energy has already achieved parity. Healthy competition in the last 15 years enabled renewables like solar energy to be available at increasingly lower costs for all consumers. Granting monopoly to Solar Para Sa Bayan threatens consumer welfare. Above all, it is discriminatory, and violates the constitutional principle of fair and equal treatment.
 
The goal of eradicating poverty in the country and providing electricity for all cannot and should not be the sole domain of any one company. Increasing access to clean energy is possible only through sustained, multi-sectoral efforts where everyone operates fairly and transparently – including power developers, network operators, installers, energy tech companies, and other stakeholders who have contributed their time, expertise, and resources to provide electricity to all, especially the poor in remote islands and other locations.
 
We call on Congress to junk HB8179. Instead, our policymakers and legislators should craft another bill that promotes fair and healthy competition, fosters reforms and innovations for QTP in un-served and missionary areas, enabling the continuing expansion of clean energy projects, broader and more efficient services, and lower electricity rates, especially for unserved and underserved areas.
 
 
CONFEDERATION OF SOLAR DEVELOPERS OF THE PHILIPPINES (CSDP)
CENTER FOR RENEWABLE ENERGY AND SUSTAINABLE TECHNOLOGY (CREST)
MANAGEMENT ASSOCIATION OF THE PHILIPPINES (MAP)
ORGANIZATION OF SOCIALIZED HOUSING DEVELOPERS OF THE PHILIPPINES (OSHDP)
PHILIPPINE SOLAR AND STORAGE ENERGY ALLIANCE
RENEWABLE ENERGY ASSOCIATION OF THE PHILIPPINES (REAP)