ENERGY SECRETARY ANGELO T. REYES

He pleads “guilty” for not knowing much about the energy sector before taking the helm of the Department of Energy (DoE) – and history would prove that circumstances were oftentimes harsh to him as to the issues he had to deal with.

More than two years on the job, and yet Energy secretary Angelo T. Reyes, self-effacingly admits that he is still on the “learning curve” as to understanding the issues and policies of the energy sector.

“When I entered this department, it’s like being introduced into the woods, I knew nothing about energy and I don’t know anybody in the energy family,” he mused over. For such a challenging assignment, the key he said is having passion and willpower to steer the department into where it should be heading to.

Make no mistake though, since as he articulated, it will not make one less of a leader “to accept your ignorance, to continue asking questions or to be willing to listen.” In any organization, he noted that there are always contrary viewpoints and opinions, and yet those are necessary to come up with balanced judgment at day’s end.

He describes his leadership style as something that tends to both the needs of the organization and the call of the times – chiefly when referring to what are the necessary steps to be taken and achieved in the policy domain.

Success in shepherding the ‘energy family’
Although taking off from fairly nothing knowledge-wise, Secretary Reyes has seen the writing on the wall as to what are the necessary policy underpinnings that the DoE and the energy family (the common reference for the departments’s attached agencies) must aggressively push for.

To a great extent, he leaned on the proficiency and competence of subalterns at the department and even with those at the attached agencies. Nevertheless, guiding them to action and policy paths were definitely the energy chief’s domain.

“I think my best achievement here was I was able to mold a fighting team – a coherent, unified team of people…in other words, you have to be able to provide the environment so that it will bring out the best in people,” the energy secretary said.

Call it stroke of luck, but after getting stalled for several years, the government’s privatization program for the power industry moved notches ahead during his watch. In just barely two years, the Power Sector Assets and Liabilities Management Corporation (PSALM) topped the targeted 70 percent threshold set for the divestment of the generation assets of the National Power Corporation, and the privatization of contracts with the independent power producers (IPPs) is now pulling ahead fairly well.

The 25-year concession deal for the National Transmission Corporation (TransCo) was also finally awarded, after four failed biddings, to the consortium of State Grid of China, Monte Oro Grid Resources Corporation and Calaca High Power. Despite the headline-grabbing controversy that has shaken the process in 2007, the government successfully cornered the $3.95-billion concession contract for the country’s transmission backbone.

Two major legislations – the Biofuels Act of 2006 and the Renewable Energy Act of 2008 – were also passed during Mr. Reyes’ time at the department.

But before anyone would accuse him of unduly taking the credit, he has this to say: “I don’t want to get the credit for that because there are a lot of people who devoted their time on it…it just happened that the need for those legislations came at that time because of soaring oil prices.” It was in July 2008 that the ‘super spike’ in global oil prices was logged at $147 per barrel – considerably the second round of crisis following the oil shock of the 1970s.

Appreciative of all the people who contributed sweat and knowledge equities in the formulation of such policies to underpin biofuels and renewable energy development, he noted that “what the country can gain and what it is proud about these was being among the first to come up with these laws.”

He admitted though that much remains to be desired in terms of proving the viability of these policies – primarily in cornering the magnitude of investments as envisioned when both laws were still at phases of deliberations in Congress.

“The important thing here is we were able to provide a viable investment climate,” he said, further stressing that his successor will work a great deal to ensure that such policies will remain stable and that the next administration would be able to inject predictability in the business environment.

Three months after the signing of the implementing rules and regulations (IRR) of the RE Law in June, the DoE brandished about the $1 billion worth of investments being planned, covering wind power projects alone. Of the RE project contracts already awarded, the DoE is eyeing additional 316 megawatts capacity from wind; while mini-hydro projects may bring in roughly 100-MW portfolio. Biomass generation will also add up capacity, initially at 45 megawatts.

He realizes though that RE development will still compete head-to-head with ‘traditional kings’ in the energy mix – oil and coal – and nuclear will be waiting in the wings as long-term option.

The development of the country’s energy resources (oil/gas, coal and geothermal) also took upturn during his term via the exploration blocks being offered in the Philippine Energy Contracting Round (PECR). In fact, for oil and gas exploration, the country was able to win back the appetite of global giants such as ExxonMobil and BHP Billiton for drilling ventures.

‘Unrepentant’ steward of the environment
If there is one thing that Mr. Reyes has been extra-zealous about, he professed that it is his “keen stewardship” on environmental preservation. It must be noted that simultaneous to his appointment at the DoE, he was also the first official tasked to head the Presidential Task Force on Climate Change.

“I am an advocate of the environment,” he would say. And these thrive as concrete explanation for the enthusiastic support and push he has been giving to energy-efficiency initiatives such as the switch to compact fluorescent lamps (CFLs) from incandescent bulbs and the country’s annual participation to the global “Earth Hour” initiative.

With the statutory mandate on government to take the lead on energy conservation, the DoE reported that the cumulative savings logged by all agencies hovered at P1.2 billion last year, or an equivalent of 131,186,516 kilowatt hours of electricity and P1.0 billion worth of fuel or 4,779,291.34 liters oil equivalent.

The parallel programs being pursued by the department on energy savings sphere are: fuel economy run for car companies and the utilization of alternative fuels. On the power industry front, the time-of-use (TOU) pricing, open access and other competitive forces are seen to eventually guide consumers on taking efficient energy use and something that shall also incentivize them on energy-saving habits.

Believing that threats of climate change risks are already starting to haunt us, he noted that every Filipino must do their share to help reverse the phenomenon and that may start by simply managing their energy consumption efficiently.

Fearless
Like an unfeigned combatant, Mr. Reyes will not also surrender to fights in the policy arena. He has been a constant figure on news items – especially in verbal skirmish with former Socioeconomic Planning Secretary and National Economic Development Authority (NEDA) director-general Ralph Recto on oil pricing calculations and overcharging allegations.

Going back to those instances where he opted to defend publicly the government’s stance on the deregulated set-up for the oil industry, the energy chief surmised that “the problem has been the lack of ventilation of issues.” He noted that while it is very easy to criticize a certain policy set-up such as deregulation, what the Filipino people must profoundly understand is that going back to the option of a “regulated oil industry regime” entails costs that may prove nightmarish to them in due time. A classic example of that has been the need to set up a buffer fund that shall replicate the defunct Oil Price Stabilization Fund (OPSF) – which as had been proven in the past, it ripped off taxpayers’ pockets.

“I’ve always heard people saying that deregulation is bad because it does not allow government to control prices. But the other side is, if you go back to regulation, it has cost and you have to tap subsidy fund – it used to be the OPSF and the sad reality is, we cannot afford it,” he stressed.

These are the same tricky issues thrown against him why his confirmation was bypassed several times at the bicameral Commission on Appointments.

There are also challenges on the country’s power supply situation, primarily for energy-starved areas in the Visayas; the threatening power shortages in Mindanao and the concerns that investors must face in the new round of power investments, including those for the Luzon grid. The case of Visayas has been hoped to be eased temporarily with the implementation of the Visayas Supply Augmentation Auction (VSAA) program while the government scours for longer term solution, such as the eventual operation of the Wholesale Electricity Spot Market (WESM) in the area to provide alternative market for power projects.

Man of character
Certainly, in various chapters of our history, we have seen the man in various forms. He was a symbolic figure in toppling the Estrada administration and the people-power led revolt in 2001 that swept President Arroyo into power. In the Executive Branch, he held the most number of Cabinet positions before his assignment to the DoE.

He acknowledges the danger of getting stereotyped, but if there is one thing that Mr. Reyes has been aspiring to be known for: it is to etch his name and be classified “as a man with character”.

“I would like to be remembered as somebody who has the courage of his convictions, the proper sense of what is right and a person who has enough courage to do things whatever the consequences are,” he enthused.

From his reign at the energy department, talks are circulating that his next target is navigating political waters that may elevate him to an elective position – whether as a local executive at Taguig or to seek an elective post at a national level.

Despite the shortcomings that energy stakeholders might have seen during his watch at the DoE, Mr. Reyes believes that he was able to add something to the sector’s growth – one that rightfully affords him to claim that he would be leaving the department in a situation that has been better than when he came.