Reaction Paper on RA9513 EPIRA

University of San Carlos Department of Electrical and Electronics Engineering  A.Y.  A.Y. 2014-201 2014-201

!n partial f"lfillment of t#e re$"irements in EE414

E%!&A' &eaction %aper 

S"(mitted (y' )eil *o#n %ere+

S"(mitted to' Engr. %#illip ,ong-arcon

#e &ep"(lic Act /1 #ic# is 3non as t#e Electric %oer !nd"stry &eform Act of 2001 or t#e E%!&A a as enacted "nder t#e administration of former %resident 5loria acapagal Arroyo. According to Section 2 of t#e E%!&A a6 !t aims to ens"re and accelerate t#e total electrification of t#e co"ntry6 o ens"re t#e $"ality6 relia(ility6 sec"rity and afforda(ility of t#e s"pply of electric poer7 o ens"re transparent and reasona(le prices of electricity6 o en#ance t#e inflo of private capital and (roaden t#e oners#ip (ase of t#e poer generation6 transmission and distri("tion sectors7 o ens"re fair and non-discriminatory treatment of p"(lic and private sector entities in t#e process of restr"ct"ring t#e electric poer ind"stry7 o protect t#e p"(lic interest as it is affected (y t#e rates and services of electric "tilities and ot#er providers of electric poer7 o ass"re socially and environmentally compati(le energy so"rces and infrastr"ct"re7 o promote t#e "tili+ation of indigeno"s and ne and renea(le energy reso"rces in poer generation in order to red"ce dependence on imported energy7 o provide for an orderly and transparent privati+ation of t#e assets and lia(ilities of t#e )ational %oer Corporation 8)%C97 o esta(lis# a strong and p"rely independent reg"latory (ody and system to ens"re cons"mer protection and en#ance t#e competitive operation of t#e electricity mar3et7 o enco"rage t#e efficient "se of energy and ot#er modalities of demand side management. !n s#ort6 E%!&A e:ists in d"e to t#ree main reasons' 819 to provide electricity to all ;ilipino people 829 to protect t#e rig#ts of t#e cons"mers as ell as t#e prod"cers of electricity and 89 o sta(ili+e t#e price of electricity.
voltages to (e transmitted to t#e distri("tion "nits t#ro"g# transmission lines. #e distri("tion "nit t#en steps don t#e voltage to a moderately #ig# degree in order to transmit it to t#e local transformer #ic# is located on o"r electric posts. #en from t#e local transformer6 t#e voltage is stepped don f"rt#er to t#e desired voltage t#at is cons"med (y t#e people #ic# can "s"ally range from 110= to 440= depending on t#e "se. ;rom #at e #ave learned6 electrical poer goes to different #ands first (efore it reac#es o"r #omes. >nce t#e government t#ro"g# t#e )ational %oer Corporation 8)A%>C>&9 totally ons t#e poer ind"stry ("t (eca"se of #eavy corr"ption in )A%>C>&6 it as forced to (e dis(anded and t#ro"g# energy privati+ation6 t#e poer ind"stry as sold to private entities and also limiting government poer on t#e said ind"stry. #ro"g# t#e privati+ation6 o"r electrical (ills no lie on t#ese private entities.  As good as t#e aims of E%!&A so"nds to o"r ears6 it contains a lot of flas. !t is d"e to E%!&A t#at electricity prices are diffic"lt to control since private entities are t#e only ones t#at can decide t#e price. !t is also (eca"se of E%!&A t#at t#e government is forced to go "nder "nfair deals it# t#e !ndependent %oer %rod"cers 8!%%9. Anot#er fla is t#at t#e government is forced to ("y t#e overall poer capacity of t#e plant instead of t#e poer it prod"ced or in ot#er ords6 A ?a3e or %ay@ Contract. !t means t#at t#e government is also ("ying t#e poer t#at is not "sed (y t#e cons"mers #ic# is event"ally passed don to t#e latter. #o"g# E%!&A made electric (illing more transparent6 it as not a(sol"te. #ere are still #idden c#arges t#at e:ist li3e some items in t#e %oer %rice Ad"stment 8%%A9 and t#e notorio"s System oss C#arges.  Anot#er fla is t#e v"lnera(ility of some government agencies li3e t#e E&C to corr"ption ma3ing t#en not only inefficient ("t also "seless6 rendering t#e (enefits of

E%!&A n"ll. !t is (eca"se of t#e corr"ption t#at delaying tactics (ecame more fre$"ent #en investigations are done regarding t#e "na"t#ori+ed electric price #i3e. E%!&A also failed to destroy t#e electricity monopoly in t#e co"ntry since some !%%Bs and DUBs still e:ceed t#e limit imposed to t#em (y t#e la. #e cons"mers are also made to pay t#e non-tec#nical system loss c#arge #ic# are in fact6 not t#eir fa"lt to (egin it#7 in addition t#e cap on t#e system loss is too #ig# t#at t#e DUBs are collecting more t#an #at is act"ally lost. a for(ids to impose E-=A on (asic necessities li3e food6 ater and electricity so t#e irony e:ists since E-=A on electricity e:ists. ,e can ma3e E%!&A red"ce o"r electricity costs (y' 819 red"ce E-=A on Electricity. ! decided not to remove ("t to red"ce since t#e ta: reven"es on t#e poer sector is still #elpf"l in poering government operations . &ed"cing E-=A mig#t red"ce government ta: reven"e ("t ill really #elp in lig#tening t#e load in t#e cons"merBs s#o"lders. 829 Anot#er ay is to impose penalties on cons"mers or esta(lis#ments t#at did not e:ert effort !n conserving electricity. #is is in order to motivate people to conserve t#eir electricity. 89 &ed"cing t#e cap on t#e systems loss c#arge ill also prevent DUBs from ta3ing advantage to cons"mers (y collecting e:cessively t#an #at is act"ally lost. 849 <"ying electricity on !%%Bs t#at offer t#e most afforda(le poer rat#er t#an c#oosing (ased on cronyism and nepotism. And also alloing t#ese !%%Bs to generate 100 poer and c"tting t#e deals it# !%%Bs t#at are "nfair. 89 !mpose a limit on a DU on t#e percentage it s"pplies energy !n order to prevent monopoly and allo fair competition. 89 Strictly impose a limit on t#e electricity cons"mption on a DU and impose penalty if proven t#at t#ey are inefficient in t#eir cons"mption in order to force DUBs to save electricity t#ey cons"me t#at t#ey pass on to cons"mers. 89 Esta(lis# a

sole agency t#at ill contin"o"sly a"dit energy related instit"tions in order to investigate any irreg"larities if any are fo"nd. astly6 appoint leaders t#at are tr"stort#y and #as a #ig# sense of moral integrity in government offices li3e t#e E&C in order to minimi+e corr"ption #appening it#in t#ese agencies #e corporate sector can also contri("te to minimi+e electric (ills (y investing more on renea(le6 efficient and clean so"rces of poer li3e solar poer and ind poer. elping t#e government in investing in drilling proects in o"r oil and nat"ral gas fields can also #elp ma3e o"r co"ntry self-s"staining in fossil f"els t#"s red"cing >rdinary people can #elp in t#eir on little ays (y conserving electricity in t#eir #omes and "sing poer efficient appliances in order to minimi+e t#ei electric (ill collection.