Metro Manila, Philippines – Some senators warned of higher electricity prices with the potential enactment of a bill prioritizing indigenous natural gas over imported gas.
The Senate on Monday passed on third and final reading the proposed Philippine Natural Gas Industry Development Act with a vote of 14-3.
Among those who were against it was the committee’s vice chairperson, Senator Sherwin Gatchalian, joined by Minority Leader Aquilino “Koko” Pimentel III and Deputy Minority Leader Risa Hontiveros.
In explaining his “no” vote, Gatchalian reiterated his concerns against Section 23 of the bill, which he tried to amend but lost in the voting. The section states that “power produced from indigenous natural gas shall have priority over conventional energy sources.”
“If this bill is passed, consumers will be required to pay for indigenous gas even when it is more expensive than imported gas,” Gatchalian said.
“For example, Meralco’s latest competitive selection process results show that the levelized cost of electricity using imported gas is 7.07 pesos per kilowatt hour, while a blend of indigenous and imported gas costs 8.45 pesos per kilowatt-hour,” he explained.
“This means, based on the example, an average household consuming 200 kilowatt-hours per month will pay an additional 276 pesos, when they could have paid less,” he added.
Hontiveros said even the “most inefficient” domestic wells will be guaranteed a market under the proposal.
“Under this bill, the domestic natural gas sector will be under no pressure at all to match their selling price with what is available from regional and global markets. Despite that, the Philippine energy sector is required to purchase everything that the sector will produce,” Hontiveros said.
Senator Pia Cayetano, who sponsored the measure as chairperson of the committee on energy, denied that it would result in higher prices.
“Ilang beses ko po pinakita sa chart sa ating mga kababayan, sa ating mga kasama, na historically napakababa nga ng presyo ng indigenous gas, kaya wag ho natin takutin ang ating mga kababayan na by prioritizing indigenous gas ay magmamahal. Hindi po totoo yon,” Cayetano said.
[Translation: I have shown several times on the chart to our fellow citizens and colleagues that historically, the price of indigenous gas has been very low. So, let’s not scare our people by saying that prioritizing indigenous gas will lead to higher prices. That is not true.]
“To make it clear, pwede pa din mag import (we can still import), we can still do that, but we are paving the ground for indigenous sources which will make it cheaper for our consumers,” she added.
She said the bill’s passage is a step closer to achieving energy security and sustainable economic growth.
Senator Raffy Tulfo, one of the bill’s authors, said the country should begin developing natural gas sources instead of relying on other countries.
“If our energy security depends on imports, then that is no security at all. In fact, it gives us a false sense of energy security,” Tulfo said.
In August, the House passed a counterpart measure, which the Legislative-Executive Development Advisory Council has identified as a priority.
