All these talk about Meralco and the high cost of electricity has made me wonder what the average Filipino household’s power bill looks like.
To make the comparison fair, why don’t we divide our electricity bill with the number of persons living in the house, including babies. I think the little darlings consume a bigger amount of electricity compared with the average person (need for airconditioning etc.)
For April, I paid P805.88 per person.
How does that compare with yours?
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Meralco shares went into a nosedive today after news of a possible investigation (good luck with making it look like a friendly Q&A) by Congress into how Meralco runs the show. If there’s anyone in the audience who doesn’t know that this is politically driven, raise your hand.
No hands?
If this entire hullabaloo actually brings down my electricity bill, goodie. But here’s a So What Chocnut snippet that people should not miss.
Exactly 20% of that electricity bill goes to Meralco. If you look at your bill, you will see the biggest portion is called generation charge, which goes to the independent power producers and the National Power Corp.
Yes, that means the government.
That simply means the power to bring down electricity rates is in the government’s hands. And that should make you wonder what the administration is trying to do. This early, the business community is already worried. Of course they are not buying the we-want-to-drive-down-electricity-costs-for-poor-Filipinos line. Former central bank governor and AIG’s standard bearer Joey Cuisia has already been interviewed on television saying, “After Meralco, who next?” Not good for business confidence.
May 16th, 2008 at 3:58 pm
I have no doubt Mr. Garcia is a good investor but I doubt his track record as a corporate manager. Just ask GSIS employees and pensioners. He wants to subdivide Meralco’s franchise area to lower power rates. That might even increase operating cost because it’s reverse economies of scale. It’s a contradiction to his other argument that Meralco should have the lowest rate because it has the biggest franchise area and thus enjoy economies of scale.
But Mr. Garcia’s proposal can very well serve the interest of his principals who all want to get a piece of Meralco’s business.
May 16th, 2008 at 3:03 pm
Corporate raider, hostile takeover or not, it is about time Meralco gets rattled. They have been in this business for so long we are entitled to know what shenanigans they have been doing to profit of our sorry a**es.
Whatever happens the end result should be a lower rate for the legal users.
May 15th, 2008 at 5:25 pm
Right now, the intention of GSIS to be a corporate raider is not yet visible. The share of GSIS, admittedly, is less than that of the Lopezes and if Meralco has employees stock ownership plans, it will be more difficult for the GSIS to take over the management of Meralco.
Usually in a hostile takeover, the “target” company is not saddled with charges of possible wrongdoings but that is not the case with Meralco which is being accused of several irregularities and Winston Garcia may utilize this to initiate a “bear hug”.
The Lopezes are experts in corporate business. They can fight off a hostile takeover anytime provided their noses are clean.
Also, not all takeovers are bad. A very recent example is Bank of America’s acquisition of Countrywide Financial, in the process Bank of America also acquired debts totaling 100 billion dollars but it expects to make profit when the U.S. housing market crisis is over.
May 15th, 2008 at 12:05 pm
During the Meralco hearings, Senator Alan Cayetano told Winston Garcia to get out if the GSIS does not like the way Meralco is being run clearly showed on whose side the senator is with.
Senator Cayetano is a politician. If he were to follow his own line of reasoning then he should get out of politics because, evidently,he doesn’t like how our government is being run. Is it not his ambition to become the President someday and change the way the government is run? So, what is wrong if the GSIS tries to change the way the Meralco is run? As long as it is for the better good.
Another thing wrong with the Senator is that he thinks the only way a business can make more profits is by increasing its prices. Businessmen today are scared of increasing their prices because they might overprice themselves out of the market. They, instead, try to maximize their efficiency , cut unnecessary expenses, and even go to the extent of trimming excess staff. The Meralco did not have to do all of these because it is a monopoly. The senator probably comes from another school of thought.
May 13th, 2008 at 10:00 pm
it’s unfair that system losses include electric consumption thru illegal connections. that cost should not be pass on to paying consumers but should be absorbed by meralco as a business risk or security issues.