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FROM measures aimed at cushioning the impact of rising fuel prices
to a tax on pollution, the myriad of proposals arising from the
ongoing Philippine energy summit highlights the growing number of
issues clamoring for government attention in the sector.
Sergio R. Ortiz-Luis Jr., president of
Philippine Exporters Confederation (Philexport), complained that
high electricity costs muted their contribution to the country’s
economic growth.
“Weighed down by a triple whammy of high
electric rates, historic high oil prices and ever-strengthening
peso, exports declined by 2 percent in November,” Luis told summit
participants.
He said that 9 percent of export enterprises
closed shop last year as a result of the above problems.
“The viability of exporting as a business has
indeed been drastically eroded. The strong peso, which is now at 41
to the dollar, and electric rates between P10 and P11 per
kilowatt-hour in Luzon, have eaten up exporters’ margins,” he
said.
“With the problem we presently face,
exporting has become less profitable than keeping a time deposit in
the bank. This is particularly true among our indigenous
exporters,” Luis added.
The businessman said Philexport will submit an
action agenda to the Department of Energy. “However, let me
underscore that the most urgent step, as we all know, is of course
to allow immediate open access for free and fair choice for
industrial consumers. It seems that facilitating industry
competition is the only way we can influence the lowering of prices
and better service,” he said.
Meneleo Carlos, president of the Federation of
Philippine Industries, wants the government to negotiate open access
as soon as possible for industry to source from lowest-cost power
suppliers and avoid oil-based power.
Carlos added that island grids and economic
zones served by oil-driven power plants can be cost competitive by
avoiding transmission and distribution costs which reach 20 percent
of their bill.
The energy department earlier said that rising
oil prices primarily affect industrial production and transportation
services.
A simulation of the National Economic and
Development Authority showed a $100 oil a barrel may slow down
domestic industry by 0.72 percentage points.
Industry accounted for 33.3 percent of the
economy, as measured by the country’s gross domestic product (GDP)
in the third quarter of last year and contributed 2.1 percentage
points to total GDP growth.
Cayetano Paderanga, chairman of the Institute
for Development and Econometric Analysis, said sectors most affected
by increases in high oil prices include petroleum refineries,
manufacturers of asphalt, lubricants and miscellaneous product, air
transport, public utility cars, rubber tire and tourist buses and
cars.
Rene Azurin of the University of the Philippines
College of Business Administration said the government should
consider taxing carbon emissions, which are being pinpointed as the
leading cause of climate change, instead of income taxes to earn
revenues.
“Instead of raising revenues by penalizing
people simply because they earn an income, government should raise
revenues by penalizing people because they pollute and cause harm to
the rest of us,” he said.
Azurin added that the more than P450 billion in
revenues the government raises from income taxes can be just as
readily raised from a specific tax based on the amount of carbon one
emits.
He said that current measures to mitigate the
impact of high oil prices on consumers such as eliminating tariffs
and taxes on oil products does not benefit the poor who use little
of their income on fuel and electricity.
“One of the things we should do in tackling
the present oil crisis is to overhaul our tax system entirely,” he
said.
Sen. Juan Miguel Zubiri plans to file bills that
would impose a carbon tax on corporations and industries that have
been polluting the environment, and remove the tariff on fluorescent
lamp imports while increasing taxes on those that use incandescent
bulbs.
“We have to step up our efforts to help boost
the country’s energy efficiency and at the same time allowing the
government to earn more revenues,” he said.
Previous studies indicated that lighting
consumes 19 percent of total global electricity production. A third
is eaten away by incandescent lighting, which is more inefficient
than its fluorescent counterpart.
Thomas Crouch, Asian Development Bank
deputy director general, said the remaining challenges for the
Philippines include making electricity rate more affordable,
averting power shortages beyond 2012 and promoting clean energy and
energy efficiency.
“With global concern about the
environment, we must all work toward a low-carbon future,” he
said.
-- Darwin G. Amojelar and
Euan Paulo C. Añonuevo
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