Abstract:
The privatization of the electricity industry appears to be the leitmotif of the Philippine electricity reform. The restructuring of the
industry is expected to make it malleable enough for the private sector to then mould it-with support from pro-private-market
regulation-into an efficient enterprise. This, the argument continues, will have a vivifying effect on all spheres of the economy. A
deeper review of the proposed reform program however suggests that much of the underlying argumentation relating to the why and
how of the reform program is untenable. It is based largely on perceptions and unfounded beliefs rather than reality and meaningful
analysis. This could result in the obfuscation of real challenges confronting the Philippine electricity industry and preclude
consideration of meaningful alternatives to improve industry performance. The broad contours of such alternatives could include
competitive sourcing of new generation capacity, publicly owned transmission and distribution networks, a regulated retail segment
and responsive regulatory and governance arrangements capable of conciliating the aspirations of various interests groups in a
transparent and efficacious manner.
