By Francessca S. Abalos
THE PHILIPPINE government should have emergency powers to regulate fuel prices during supply disruptions and other crises to protect consumers from excessive increases, senators said on Thursday, as the prolonged Middle East war puts pressure on global energy markets.
Senate President Sherwin T. Gatchalian proposed amending Republic Act No. 8479 or the Downstream Oil Industry Deregulation Act to allow government intervention when external shocks threaten fuel supplies or trigger extraordinary price increases.
“During abnormal crises or abnormal situations, the government cannot be rendered helpless,” Mr. Gatchalian told a Senate hearing. “The government must have the power to protect consumers.”
He said the proposed changes would help prevent oil companies from imposing arbitrary price increases during emergencies. “If our consumers are being abused because of an abnormal situation, their only hope is the government,” he added.
Mr. Gatchalian also raised concerns about electricity costs, saying the Philippines had the second-highest power rates in Southeast Asia at P14.75 per kilowatt-hour (kWh), compared with Singapore’s P17.09 per kWh.
Clarice Ann Bernal, a lawyer representing the Energy Regulatory Commission (ERC), attributed higher electricity costs partly to Manila Electric Co.’s reliance on liquefied natural gas.
Senator Erwin T. Tulfo questioned why electricity generated from coal had become nearly as expensive as gas-fired power despite differences in fuel costs.
He urged the ERC to examine the pricing of coal-fired generation and determine whether increases were justified.
Ms. Bernal said the country’s reliance on imported coal had also pushed up generation costs. She committed to submitting a report explaining the increases in coal-related electricity prices.
Mr. Gatchalian said electricity rates in the Visayas and Mindanao had also climbed to P12.42 and P12.61 per kWh, respectively, raising concerns about regional power costs and supply adequacy.
Energy Undersecretary Riolita D. Inocencio said the Visayas relied partly on electricity supplied through interconnections with the Luzon and Mindanao grids.
She said transmission and interconnection facilities needed upgrading to improve electricity delivery to the region. Private-sector power barges would be deployed to help address supply shortages, she added.
Mr. Tulfo separately questioned frequent gasoline price adjustments, saying they confused consumers and could encourage fuel stockpiling when prices were expected to rise.
“So we’re really at the mercy — the Department of Energy, the oil industry, the government [are all] at the mercy of the companies,” he said. “I’m not saying they’re evil, but my point is, I suppose, what about the protection of the consumer?”
Ms. Inocencio said the Department of Energy supported stronger government authority to intervene when fuel prices become extraordinarily volatile.
She said the agency also wanted provisions allowing intervention when evidence of fuel hoarding emerges.
“This is really a necessary amendment,” she said, citing the need to boost government intervention powers during extraordinary circumstances.
Ms. Inocencio said the proposed changes would also improve the government’s access to industry information, allowing regulators to establish permissible ranges for fuel price increases and decreases during emergencies.