National security threatened
Devanadera, when asked about reining in NGCP, cited several legal issues, including lack of funds and personnel, for not conducting a credible audit.
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Daily TribuneDevanadera, when asked about reining in NGCP, cited several legal issues, including lack of funds and personnel, for not conducting a credible audit.
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A key failure of the previous Energy Regulatory Commission administration that has made it difficult for its current administration to make concessionaire National Grid Corp. of the Philippines toe the line in terms of its contract with the government was its reluctance to audit the NGCP.
Eventually, the ERC then under Agnes Devanadera, who is now Clark Development Corp. president and chief executive officer, did conduct an audit of the systems and operations of NGCP remotely or through Zoom which was a perfunctory effort.
In a Senate hearing then, National Transmission Corp. president Melvin Matibag said that since the private concessionaire took over NGCP, its dependable Western-made equipment from Asea Brown Boveri, General Electric and Siemens were replaced with an entirely Chinese system provided by NARI Group which is controlled by the 40-percent owner of NGCP, the State Grid Corp. of China, or SGCC.
Installed throughout the system were NARI equipment that Matibag said allowed the Chinese firm to boast on its website that "they control the power grid of the Philippines."
Former National Security Adviser Hermogenes Esperon said that in 2009 when the concession deal with NGCP to operate and manage the electricity system took effect, his office and the National Intelligence Coordinating Agency had to conduct a background check on the "personalities" with access to the electricity grid since they were NGCP officials.
"They came from a private corporation that was also a state corporation. I don't know if there are many corporations in China where the government has no stake," he told members of the Senate committee on energy.
Esperon then revealed that NGCP used a "dark network" to transmit data that was not linked to the internet. "It may not be very vulnerable to hacking as we know it but it still can be penetrated by way of physical intrusion… by persons who have interests that are not consonant with ours," he noted.
"As I said, there is no impenetrable barrier," Esperon added.
Alfonso Cusi, energy secretary at the time, said in his Senate testimony that the vulnerability of the transmission grid was partly the result of the "uncooperative attitude of NGCP to subject themselves to audit."
He stressed that it was not about the nationality of the stakeholders but more about "the security measures and the redundancy of the system. And that was the purpose of the audit that we had been asking for from the very beginning."
"How can we tell people that we are safe? The only way to ensure that is through an audit," Cusi pointed out.
A provision in the concession deal with NGCP stated that representatives of the government were mandated "to inspect the transmission assets and to witness any aspects of the performance of the agreement."
Even when faced with the issues hounding NGCP, which fell under the ambit of the ERC as the regulator, Devanadera when asked about reining in NGCP cited several legal issues, including lack of funds and personnel, for not conducting a credible audit.
Thus, with all the excuses given by ERC to stall a review, NGCP was able to consistently avoid an audit.
The current Department of Energy and ERC administrations are now pressing for a comprehensive check of the whole system and the operations of the concessionaire on pain of penalties since it would be a denial of a provision under the agreement with the government.
The recent blackout that hit Western Visayas was atrocious since Panay and Negros were considered to have excess power supplies, which only points to the fault of either the electricity grid or the power plant operators.
The purpose of an audit is to determine the weaknesses of the electricity backbone.
What has been made obvious is that the country's power supply, which is its economic lifeline, is under the control of a group that can be influenced by a foreign power.
