Industries support Cusi’s energy mix policy prescription

By Myrna M. Velasco – December 13, 2016, 10:00 PM

from Manila Bulletin

The competitive-laden energy mix economics propounded by Energy Secretary Alfonso G. Cusi gained traction in the league of industries and manufacturing firms operating in the country.

In a statement to the media, the Federation of Philippine Industries (FPI) noted that the 70-percent baseload; 20-percent mid-merit and 10-percent peaking and technology-neutral power mix could “indeed promote a more competitive market and eventually lower the power costs that consumers pay.”

Cusi’s energy mix prescription leans on non-imposition of quota or caps on any specific energy technology.

The group, which counts membership from 34 industry associations and 120 corporations from the manufacturing sector, concurs that “the move of the DOE will ensure ample supply of power for the country as it moves toward industrialization.”

According to FPI Chairman Jesus L. Arranza, the pronouncements of the energy secretary “are consistent with FPI’s stand on supporting industrial growth by ensuring stable baseload power supply.”

The group said it “recognizes that the country needs diversified energy resources but this can be achieved even without mandating a strict power generation mix that will limit the technologies that will be developed by the private sector.”

FPI similarly noted “the flexible power generation mix envisioned by the DOE will encourage power players to continue developing the projects they deem to be the most competitive.”

In Arranza’s view, “mandating an energy mix policy that caps the technologies will not only cut out flexibility but will also go against the idea of having a competitive market, where all suppliers can make offers.”

He added “limiting the kind of technology to be developed will just unnecessary block development of power plants and hinder more investments.”

Amid the hysteria versus the dominance of coal-fired power plants in the country, FPI sternly batted that the Department of Energy (DOE) learns to listen beyond the noise and dodge any aspiration of energy mix that would not be reflective of the power industry’s practical realities and the country’s aspiration for economic growth.

Their bid is for government not to be susceptible to an energy mix policy, which is nothing but a sort of “straitjacket solution” that could not bring down power rates.

In a sustainable future, experts have been noting that the sheer reality is for a country to take care of its economic subsistence and consumers’ survival first, but eventually, it shall not be spared from ‘cleaning its acts’ including on its energy installations. In FPI’s view, there is a need for government “to allow the market sort itself and realize an energy mix that gestates affordable electricity rates.”

In essence, the country needs a framework that is flexible and pragmatic rather than prescriptive and anti-competitive.