Inflation woes derail power goal

Communities served by Napocor are not connected to the main grid. They have relatively lower energy requirements and are not in a financial position to pay for high-priced electricity from diesel. Instead of spending the people’s money to continue to subsidize diesel purchases

Nearing the 100 percent dream target that will have all households enjoying electricity service, the country may just hit a major obstacle as a result of the global inflation contagion particularly the astronomical prices of fuel.

The state-owned National Power Corp. will reduce services to areas served by its unit Small Power Utilities Group or SPUG due to the high diesel prices.

Starting 1 February, Napocor will implement the reduction of electricity service in SPUG areas due to fuel shortages and the delay in the universal cost for missionary electrification subsidy payment, the National Electrification Administration said.

Consumer groups warned that the move to cut electricity service to remote areas is an indicator of things to come this year.

SPUG supplies electricity to remote communities as mandated by Republic Act 9136, or the Electric Power Industry Reform Act or EPIRA through small diesel power plants.

Small communities served by the diesel power plants of Napocor would have greatly benefited instead from indigenous renewable energy sources, both in receiving a steady supply of electricity and affordability of energy, according to consumer coalition Power for the People said.

“The communities served by Napocor are not connected to the main grid. They have relatively lower energy requirements and are not in a financial position to pay for high-priced electricity from diesel.

Instead of spending the people’s money to continue to subsidize diesel purchases, the DoE could have used these resources to build microgrids that would spare the residents from the worst effects of the power crisis,” P4P convenor Gerry Arances said.

NEA Administrator Antonio Mariano Almeda shares the high hopes of tapping clean energy sources for cooperatives to sustainably operate and in the long run, help them lower power costs.

The energy consumer advocate expressed concern that the same thing would soon happen to the national grid and said the problem of high fuel costs affecting the operations of power plants may likely spread to the whole grid.

“Coal and natural gas prices continue to rise. In the case of natural gas, there have already been reports that long-term supply contracts are no longer available, exactly at the time when the supply of Malampaya is drying up,” the consumer group indicated.

“We cannot be trapped in chasing electricity with more money to be paid by consumers. Ultimately, consumers would balk and stop paying or there will be simply no fuel to burn. Let’s break out of the trap and fast-track renewable energy development,” Arances added.

The continuous increase in diesel fuel prices has exhausted its allotted funds for fuel, according to Napocor.

The Department of Energy authorized Napocor to borrow from banks to support its operations following a legal opinion from the Department of Justice.

Napocor has requested a P5-billion loan for fuel purchases but it expects to receive the funding in May at the earliest.

“At present, Napocor’s current fuel supply continues to dwindle after its fuel supplier again halted delivery. Much as it wanted to maintain current service hours, Napocor is left with no option but to reduce the operating hours of its power plants to stretch the current fuel supply until the 31st of December,” Napocor said.

New DA chief? Not yet

President Ferdinand “Bongbong” Marcos Jr. said he wanted to accomplish “all the hard things” first before he appoints an “agriculture expert” who would take over his post as head of the Department of Agriculture.

Marcos who met the media before returning home from the World Economic Forum in Davos was asked if he is considering a retired military or police general for the Department of Agriculture portfolio to instill discipline in the agency.

“One must be an expert in agriculture. Agriculture is a very complicated subject. You cannot just appoint anybody to manage the DA. They have to understand the science. They have to understand the solution, the system,” he told the Philippine media.

“Unless they’re involved in agriculture. There are people who retired and got heavily involved in agriculture. If they are knowledgeable, why not?” he asked.

Marcos said he aims to get “the old, hard things” out of the way for his coming appointee to the post.

“I will do all the hard things now. Once I have already ticked off the bucket list and accomplished everything, then I will leave. I will give it (the position) to somebody else,” he said.

Weeks after he assumed the presidency in June 2022, Marcos announced to lead the Department of Agriculture in the first few months of his administration to address the looming food crisis in the country.

Marcos saw issues in the agriculture sector as “deeply embedded”, saying it would take a President to “turn the situation around.”


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