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Redefining public utilities

Ike Señeres .

MANY people are now saying that internet access is no longer a luxury because it is already a necessity. Much more than that, internet access is already an economic need, because it is already a must in order to succeed in business. There was a time when it could be said that one could do business even without doing e-commerce. Nowadays however, it could already be said that if one is not yet doing business, one is really not doing business at all. One might also argue that internet access is used mainly for social purposes. While that may be true, what is really happening now is that social activities are intertwined by business activities. Proof of that is the fact that social networking sites are now being used for business, such as “Marketplace” by Facebook.

In reality, electricity is a commodity that is sold and bought, and there is a system that delivers it from source to the last mile. That system includes the three stages namely production, transmission and distribution. For example, the National Power Corporation (NPC) does the production, the National Grid Corporation of the Philippines (NGCP) does the transmission, and Meralco does the distribution. I think that that is an ideal system that should be copied as a similar system for water. Right now, it could be said that the Metropolitan Waterworks and Sewerage System (MWSS) does the production side for Metro Manila, while the National Water Resources Board (NWRB) does the production side for the rest of the country. There is however a break in the chain, because in Metro Manila, both the transmission and distribution functions are done by either Maynilad or Manila Water. There seems to be a similar break outside of Metro Manila, as all the three stages appear to be monopolized by the Local Water Utilities Administration (LWUA).

It may be too long ago to remember, but there was a time when cooking gas was a commodity. At that time, Manila Gas Company managed all the three stages namely production, transmission and distribution. For whatever reason, that company is no longer around, and that is why we have retrogressed to the primitive system of distribution by way of Liquid Petroleum Gas (LPG) bottled canisters. That seems to be our unfortunate fate. We cheered when the government built the Light Rail Transit (LRT) and the Metro Rail Transit (MRT) systems, but little did we know that that is not really a leap in progress, because we already had electric railway cars before, during the time of the Manila Electric Railroad and Light Company, the original Meralco. After that, we had to make do with buses. Definitely we could not call that progress, so let us call that retrogress.

In a manner of speaking, it could be said that internet signal is also a commodity that could be sold and bought, and it could also have three stages namely production, transmission and distribution. That is really just a figure of speech, because the production in this case could be the landing of undersea cables and the reception by satellite earth stations. To some extent, the transmission in this case could be the fixed and wireless networks that deliver the signal all the way to the ends of the last mile. From there, the actual last mile providers would handle the distribution, into residential, commercial and industrial customers inside these premises. At that point, the signal is connected to devices via fixed and wireless connections. As it is now, many of the last mile providers are Small and Medium Enterprises (SMEs), but I am hoping that cooperatives could capture a share of this market.

As it is now, cooperatives are already in the distribution business by way of all the electric cooperatives. Using that as a precedent, we could actually wish beyond hoping that other last mile distribution services could be given to the cooperatives, such as water and internet signal. There is actually no problem about the latter, because I am already laying the groundwork for that. Actually, cooking gas could still possibly be a list mile distribution service, if only we could put our acts together as we should. As it is now, there are still many sources of natural gas that could be tapped for distribution. Aside from that, I have not given up on methane gas or biogas as the case may be. Rather than doing this on a grand scale, it may be better for each cooperative to produce their own cooking gas at source, where they live.

Over the years, I have seen many new technologies that were presented to government agencies that did not materialize. In many of those cases, I surmised that the problem really is not technical. Instead, I think that the problem is political, in the sense that political will is needed in order to lay the groundwork for the adoption of new technologies. In many cases, many government officials would object to the adoption of these technologies, arguing that these are too expensive. I think that that is really the downside of government agencies is that it is very difficult to quantify the value of the services provided. It would be easier to do that in the case of private companies, because everything could be measured in terms of profits or returns of investments. Instead of measuring in terms of profit, perhaps a social value could be assigned to the social benefits?




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