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Bacolod City, Philippines Friday, July 1, 2011
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Privatization driving
power rates up: DOE
BUT NEGROS FUEL PRICE GAP DROPS
BY CARLA GOMEZ

Department of Energy officials yesterday said that consumers have to brace for higher power rates, but more competition will eventually bring prices down.

Power rates throughout the country are going up with the implementation of the EPIRA (Electric Power Industry Reform Act) that has led to the privatization of power firms, Rey Malleza of the Department of Energy Visayas Field Office said.

Malleza said that, before the privatization, power rates were lower because they were subsidized by government, but with EPIRA, consumers are now paying their true rates.

He said while the National Power Corp. sold subsidized power at P3 per kilowatt hour with privatization it is now P7.

However, with the entry of more power firms and open access to power, the rates will eventually go down, he said.

Antonio Labios, director of the Visayas Field Office, assured that the Visayas now produces 1,700 to 1,800 megawatts of power, which is in excess of its current demand of 1,350 to 1,400 megawatts.

But he warned that if no new plants are built staring 2017, Visayas’ power needs will again hit a critical level by 2019.

He reiterated the need for Negros Occidental to work at coming up with its own power plants, pointing out that electricity will be cheaper if the source is nearer.

Capiz Gov. Victor Tanco, chairman of the Western Visayas Regional Development Council, said Negros Occidental is fortunate to have lower power rates than Panay now.

We are trying to find renewable sources of energy to eventually bring down power costs, he said.

Guimaras Gov. Felipe Nava said TransAsia is doing the groundwork in his province for the production of 54 megawatts of wind power, with the construction phase expected to start next year.

Guimaras only consumes 5 megawatts of power so the rest of the power generated can be sold to Panay, he added.

FUEL RATES

Meanwhile, Labios said the price disparity between fuel sold in Negros Occidental and Metro Manila has reduced slightly.

More fuel firms, aside from the big three players in Negros Occidental, will eventually reduce the price difference, as it has done in Cebu, he added.

Frank Carbon, Metro Bacolod Chamber of Commerce and Industry president, yesterday said the price difference between fuel sold in Metro Manila and Negros Occidental is now about P3.50 to P4, from P5 previously.

The prices have gone down because of local protests, but he said it is still not enough.

Carbon said an acceptable price difference, based on freight cost, would be from P1.50 to P2 only.

We support a congressional hearing on the matter so the reasons for the high price difference can be uncovered, he said.*CPG

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