Stumped

We are still counting the economic costs arising from that careless statement the President made about “systems losses.” It sunk stock prices and created even more regulatory uncertainty across the investment community.

It is not as if we have become an investment haven. Investments have been declining in most areas of business. Now the decline has become steeper.

The energy sector is in dire need of investments. We need to modernize our grid. We need capital to bring our electricity retail capacity up to par by introducing newer technologies.

If our electricity has become the most expensive in the region, it is because our transmission and distribution systems are inefficient. Large systems losses is precisely a symptom of this inefficiency. To reduce it, we need more capital flowing into the energy sector. Yet the President’s reckless pronouncements scares capital away.

Our economy’s power requirements are not receding. Even if our growth rate has slowed alarmingly, we still need to upgrade our power sector. Unless we do that, economic activity will stagnate all the more.

A distribution utility like Meralco does not just maintain crews 24/7 to deal with natural calamities. It needs to put in more investments in such things as an Advanced Metering Infrastructure (AMI) that will replace the traditional electric meter with a smart meter linked to other components of its network. The AMI will ensure better network visibility, faster detection and response, therefore more reliable service.

Supported by other new technologies, operators will have better visibility of what is happening across the distribution network. The whole network needs constant upgrading of transformers, switchgear, circuit breakers and other complementing equipment. Just last March, the distribution utility completed upgrading its Camarin Substation in Caloocan at a cost of P208.45 million.

Power generation, transmission and distribution need rapid modernization. The power sector is vital infrastructure. It is also, like all infrastructure, capital intensive.

Meralco has planned for a P272-billion capital expenditure program for 2027-2030. Mobilizing this scale of investments requires a high degree of policy certainty – precisely what was diminished the past few weeks.

When Meralco’s stock prices declined after the President’s speech, that means the company will have less market capitalization to pursue its modernization goals. That means electricity will still be lost due to pilferage, poor metering and backward distribution systems. All these will not make power cheaper. It will keep power expensive longer into the future.

We will not have cheaper energy for as long as our power sector remains backward. But to modernize it, we need a large volume of investments. To have those investments, we need investor confidence that our economic policies are kept away from the slippery slope of populist demagoguery.

Donors

This is straight out of the theater of the absurd. Sen. Rodante Marcoleta and three individuals who made donations to his senatorial campaign were hastily charged with plunder and thrown in jail.

Last week, former congressman Mike Defensor was manhandled as he tried to address questions from reporters while being led out of the courtroom. His captors were apparently under orders to keep him from speaking to the press. He has not only been deprived of liberty but also denied freedom of expression.

The crime of plunder was contrived with the aim of deterring graft. It is a crude sledgehammer that, while failing to reduce the volume of corruption in this country, inflicts damage to individuals denied their right to bail. The presumption of innocence, which underpins our justice system, is impoverished by this crudely crafted statute.

The three businessmen, including Defensor, made their donations in good faith. They even paid donor’s taxes to cover their contributions. The Comelec decided there was no crime in the way the donations were documented after these were made. If there was anything irregular here, it was due to Marcoleta’s failure to fully disclose his campaign finances.

The plunder statute is designed to be unduly harsh. All the four are denied bail according to the letter of the law – regardless of the differences in what each had actually committed.

The ombudsman wielded a blunt instrument in the case of Marcoleta et al. The candidate’s failure to disclose donations made to his campaign does not mean that each donor knowingly participated in plunder. To date, the ombudsman has not identified any government project, contract or specific benefit sought or obtained by either of two other businessmen now jailed alongside the senator.

Campaign donors do not control the candidate’s disclosure of his election spending. Unless the prosecution presents evidence of any contract or illicit political favor sought in exchange for the campaign donation, the act should be presumed to have been performed in good faith.

Plunder is the outcome of a conspiracy. It is the burden of the prosecution to establish the facts of such a conspiracy. Short of that, the absurd charges stand on unstable grounds.

The businessmen who made the donations are ordinary citizens. They are not seeking government contracts. Now they are pleading with the Sandiganbayan to at least be allowed to post bail.

The bail hearings should provide the ombudsman’s lawyers the chance to substantiate the charges they made. If they are unable to do so in a convincing manner, a sense of fairness should guide the court towards granting the right to bail.

The two businessmen are not by any measure political players.