Energy Secretary Raphael Lotilla said Monday the Department of Energy is committed to removing barriers to private-sector investments in the energy sector as the country grapples with an anticipated tight power supply during the dry months.
“All our efforts in the current administration have been directed at reforming a number of these policies that have been stumbling blocks in the entry or to the entry of new investments,” Lotilla said during the National Economic Development Authority economic forum.
Lotilla said that among the sectors, the energy sector is the most dependent on the private sector.
“It is the government that sets the policies but it is the private sector that drives investments and operations in the upstream sector, in the midstream sector, as well as in the downstream,” he said.
Lotilla said the policy of the energy sector is to have a market-driven approach and remove stumbling blocks to make the market work.
Lotilla said the DOE was also studying removing the secondary price cap imposed in 2013, “but this has been difficult to lift at this time because of the impact on prices, but we will have to deal with this if we want to get more investments down the line.”
The Energy Regulatory Commission imposed an SPC of P6.245 per kilowatt-hour upon breach of a P9 per kWh rolling average price over three days at the electricity spot market to protect the public and prevent the repetition of excessive and unreasonable high market prices.
The Philippine Independent Power Producers Association Inc. reiterated its call to remove the secondary price cap at the spot market to entice investors to build more power plants.
“The secondary price cap needs to be re-evaluated, and we are pushing for a removal or at the very least gradual removal to send the correct signals to our investors,” PIPPA president and executive director Anne Estorco Montelibano said.
“More investments will lead to sufficiency in supply and competitive prices. We note that the increase in fuel/coal prices is not only an issue of electricity prices but also in making sure that investments will not falter. As such, PIPPA will continue to advocate for the removal of the secondary price cap,” the group said.