The energy committee of the Philippine Chamber of Commerce and Industry wants the government to look at the possibility of subsidizing power rates like in some countries to reduce electricity costs.
PCCI chairman of energy and infrastructure committee Jose Alejandro said during an energy forum that power costs in the country had not been going down.
“We still have a big challenge in our hands. With all the efforts that have been going on, power cost is not going down even by 10 percent when our competitors (are) 30 to 50 percent lower than us. That is the challenge we have,” Alejandro said.
The Philippines ranks second highest in terms of residential power rates and third highest in average power rates in the Asia Pacific.
“In the end, we have to think of how to subsidize our power costs. No way can we run away from the word subsidy. We all know… our competitors are subsidized,” Alejandro said.
The PCCI official said other countries subsidized their power rates to remain globally competitive and attract investors.
“They subsidize because they want foreign direct investments to come in their country and they are succeeding. Their GNP (gross national product) is going up, their per capita is going up and if their per capita goes up, they’re slowly raising power costs,” he said.
He said there were no new investments and existing investors were not expanding.
“We have to avoid running away from the issue of subsidizing power costs. I cannot see how our cabinet secretaries are going to UK, promoting investments and we all know our power costs is not competitive. What kind of investments are going to come here?” he said.
Alejandro said the Philippines must attract more manufacturing companies to invest in the Philippines.
“We’re trying very hard to bring down the cost… but the sum total is, it’s not enough to bring us to a competitive level,” he said.
Alejandro said a more transparent and real competition in the power industry would reduce the cost.
He said the government should also focus on smart grid programs so that the distribution of power, later on, could be done more scientifically.
Alejandro said the government must also look at off-grid or missionary areas “because that’s where markets are going to be created.”
“If we can come up with a program to bring down costs, business will grow in that area. Population that is coming in the urban areas will go there,” he said.