March 11, 2024
MANILA – The $3.3 billion (P184.89 billion) deal between the country’s three biggest energy firms may pose a threat to consumers and raise electricity rates if there will be a continued monopoly of the liquefied natural gas (LNG) industry, according to a consumer group.
The United Filipino Consumers and Commuters’ (UFCC) said this after Meralco PowerGen Corp. (MGen), Aboitiz Power Corp., and San Miguel Global Power Holdings Corp. (SMGP) announced a landmark agreement last week to jointly launch the Philippines’ “first and most expansive” LNG facility in Batangas province.
UFCC president Rodolfo Javellana Jr. specifically claimed that this agreement is geared towards “maximizing [their] profits and tightening their grip on the LNG industry.”
“What transpired was these oligarch companies consolidated to maintain their monopoly in the power industry. In this consolidation, they aim to maximize the profits for their respective corporations,” Javellana said.
He pointed out that about eight million consumers, dependent on services offered by these companies, would bear the brunt of repeated rate increases.
“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,” Javellana said.
Javellana also pointed out the government’s inaction on the need to protect consumers.
“This was further worsened by the regulatory capture of government agencies that should have been acting as check and balance and defending the 8 million consumers held hostage by constant price hikes,” Javellana said.
“The public cannot hope for any redress in the future as they can only expect costlier electricity,” he added,
Javellana likewise said that an increase in electricity prices might hinder the economic goals of the current administration, specifically in attracting foreign investors since the country’s power costs are among the most expensive worldwide.
“Congress should step in and repeal or amend the Epira law, which is the root of high power costs,” he added.
SMGP chair and president Ramon Ang said last week that the three leading power companies are working together to secure the country’s energy needs while transitioning toward cleaner power sources.