House vows to act on power reduction bills

MANILA, Philippines - Speaker Prospero Nograles promised yesterday to make the House of Representatives act swiftly on bills on power reduction and oil industry cartelization.

He said the measures are still pending in the committee on energy and the committee on ways and means, chaired by Representatives Juan Miguel Arroyo of Pampanga and Exequiel Javier of Antique, respectively.

He said he and his colleagues would try to act on the bills before senators and congressmen adjourn for the election campaign in early February.

Nograles was reacting to the call of Senate President Juan Ponce Enrile for the House to approve important pending bills before its election campaign adjournment.

Those include at least two measures authored by Enrile in the Senate and by his daughter-in-law, Cagayan Rep. Salvacion Enrile, in the House.

One bill filed by the Enriles seeks to remove the royalty tax on natural gas extracted in Palawan and used to generate electricity in Luzon.

Some 40 percent of Luzon’s power requirement is produced with the use of natural gas.

Enrile estimates that if the royalty tax is removed, power rates in the island, including Metro Manila, could go down by as much as P2 per kilowatt-hour (kwh).

Rep. Jonathan dela Cruz of the party-list group Abakada-Guro, who has a separate power reduction proposal, said the royalty levy has pushed the cost of electricity in the country to a level that is highest in Asia, surpassing even Japan.

He said a recent study conducted by an American investment bank showed that the country has a power cost equivalent to 14 US cents per kwh, while Japan’s is only 11 cents.

About a year ago, Dela Cruz said Japan had the highest electricity cost in Asia. “No wonder many foreign businesses are moving out and relocating in countries where electricity is cheap,” he said.

Another bill that Senator Enrile wants the House to approve is his proposed anti-trust law known as “The Competition Act of 2009,” which seeks to stop oil companies, pharmaceutical firms and other businesses from colluding to manipulate prices.

Nograles has expressed support for the proposals.

“I would like to state on record that I fully support Senate President Enrile’s bills. I know that this will redound to lower electricity rates that will benefit not only residential electricity consumers but industries as well,” he said in an earlier statement.

“I firmly believe that by supporting these bills, we will be able to boost our economy and provide more jobs to our people,” he said.

The elder Enrile, who was defense minister during martial law, won in 2004 on a campaign to reduce power rates. So far, he has not succeeded in doing so and his bills are his first attempt at fulfilling his campaign promise.

Nograles agreed with Enrile that the Philippines is the only country collecting a 60-percent royalty on indigenous fuel source.

He said the benefits of the bills far outweigh the revenues the government would lose.

“In my view, what is more important is that investors will stay and others may come to the country because of cheaper electricity costs.

“Given that situation, government will be able to collect more taxes instead of what is happening now that many industries are moving out or contemplating relocating elsewhere due to high electricity costs,” he stressed.

“What will we collect if industries move out?” he asked.

He added that reducing the cost of electricity “is really a win-win situation for both government and business.”

Not too long ago, President Arroyo herself decried that power rates in the country were among the highest in Asia. Nothing happened after her outburst.