Exactly one year ago today I was talking about sex. Well, actually I was talking about the tango, which IS sex. Well, truth be told, I was really talking about the key to lowering power costs under EPIRA (but there is a nice pic of sex the tango). And lo and behold the ECs, today, are on the dance floor, doing the tango, no less. Or at least giving it a good shot.
The Panay ECs structured a procurement process that drew the interest of six participants. All six responded yesterday with competitive offers to provide supply to the seven ECs on Panay and Guimaras.
[Disclosure: I'm consulting to the Panay ECs on their procurement. But I was pulled into this. I did not initiate it, nor am I the driving force behind it. This is an EC driven initiative.]
Somehow, the image of an unarmed warrior going into battle with the private sector IPPs fits the Philippine electric cooperatives.
Jujutsu evolved among the samurai of feudal Japan as a method for dispatching an armed and armored opponent in situations where the use of weapons was impractical or forbidden. Due to the difficulty of dispatching an armored opponent with striking techniques, the most efficient methods for neutralizing an enemy took the form of pins, joint locks, and throws. These techniques were developed around the principle of using an attacker’s energy against him, rather than directly opposing it, and came to be known as jujutsu. - Wikipedia
But if you utilize the power procurement process intelligently, it can achieve wonders for you. It can achieve, for struggling, technically out-gunned cooperative planning staffs, what would traditionally take NPC many months and many hundreds of thousands of dollars in computer studies and qualified staff and consultants to do – determine and implement a cost-effective, risk-mitigating power supply portfolio.
Let me back up. Here is what ECs have been paying for from NPC: 
Here is what NPC did for the ECs at the cor. Agham Rd. and Quezon Ave.:
Here is what the IPPs will do for the ECs.
So the ECs have to do all the other stuff that NPC used to do – planning, procurement, etc. But the trick is to let the competition work for you so that you don’t have to spend as much money as NPC did building out an ivory tower that didn’t always really work that well anyway. The trick is to structure a competitive process that strategically uses the technical know-how and capabilities embedded in the IPPs – to use market forces – to both keep the IPPs from taking advantage of you and at the same time to sort out the optimum portfolio for you.
The trick is to neutralize the IPPs natural position of having more capability and knowledge and power and money than an EC and to use that for the EC customers’ own purposes.
I come from the U.S. rural electric cooperative sector. I’ve seen big, private sector utilities (power suppliers) be thrown in the air by cooperatives and come down landing flat on their backs, gasping for air. It takes smart legal and regulatory footwork – but it can be done.
Jujutsu.