Consumer group: $3.3 billion LNG enterprise to bring higher power rates

Consumer group United Filipino Consumers and Commuters (UFCC) over the weekend said government inaction on the $3.3-billion liquefied natural gas (LNG) facility in Batangas would lead to higher electricity rates.

In a statement released Sunday, the UFCC said the Batangas LNG facility — led by three of the biggest players in the industry — would cause higher rates for eight million customers, as this was designed for imported LNG which is more expensive.

The group did not elaborate on its remarks, but said the partnership of San Miguel Global Power Holdings Corp. (SMGP), Meralco PowerGen Corp. (MGen), and Aboitiz Power Corp. was aimed at “tightening their grip on the LNG industry.”

“The public cannot hope for any redress in the future as they can only expect costlier electricity,” UFCC President Rodolfo Javellana Jr. said.

“This was further worsened by the regulatory capture of government agencies that should have been acting as check and balance and defending the eight million consumers held hostage by constant price hikes,” he said.

GMA News Online has reached out to the Department of Energy (DOE) for comment on the matter, but no response has been received as of this posting.

Under the partnership announced earlier this month, MGen and Aboitiz Power will jointly invest in two of SMGP’s gas-fired power plants — the 1,278-megawatt Ilijan Power Plant, and a 1,320-megawatt combined cycle power facility set to start operations this year.

The three parties will then invest in nearly 100% of Linseed Field Corporation’s LNG import regasification terminal, which will be used to receive, store, and process fuel for the two power plants.

“What transpired was these oligarch companies consolidated to maintain their monopoly in the power industry… In this consolidation, they aim to maximize their profits for their respective corporations,” Javella said.

“Even then, reducing electricity rates for the well-being of consumers had never been the priority of these companies… Their primary goal as always is to ensure that their earnings are big,” he added.

Requests for comment were also sent to the San Miguel, Meralco, and Aboitiz groups, but responses were not immediately available.

National Economic and Development Authority (NEDA) Secretary Arsenio Balisacan in September said the Philippines would need $103.6-billion or P5.8-trillion worth of investments in renewable energy projects to meet the target power generation mix by 2040.

Foreign investors or companies have been allowed to engage in the Philippine renewable energy sector after the Department of Energy (DOE) in November 2022 amended the implementing rules and regulations (IRR) of the Renewable Energy Act of 2008.

The administration is also looking at amending the Electric Power Industry Reform Act (EPIRA) to bring down the cost of electricity across the country. — DVM, GMA Integrated News