Power crisis in major tourist spots hurting MSMEs — study

The majority of businesses, particularly the micro, small, and medium enterprises (MSMEs) in prime tourist destinations in the country — namely Siargao Island, Puerto Galera, Cebu, and the Island Garden City of Samal —are reeling from million-peso losses monthly as the energy crisis remains persistent in those areas.

In a press conference on Wednesday, advocacy group ILAW revealed the results of the focus group discussion (FGD) on the economic impact of blackouts on tourism businesses at the said destinations, showing that losses in revenue are tremendous when these destinations suffer persistent power outages.

According to the report, 74.29 percent of MSME respondents said they are losing P10,000 to P30,000 per day, while large businesses incur P100,000 in revenue losses daily.

The study further stated that without electricity, businesses are forced to stop or delay operations, requiring enterprises to implement cost-cutting measures such as reducing staff, cutting down inventory, and/or limiting operational hours.

According to the study, business owners in Samal Island are experiencing losses ranging from a low of P10,000 to a high of P100,000 per day.

“Most losses are substantial to their monthly electricity cost, especially for resorts and hotels. Mayor Al David Uy stated that the city had been losing P50 million annually in the tourism sector due to power issues. The Northern Davao Electric Cooperative has been criticized for its poor service. Business owners report slow response times, lack of accountability, and no compensation for losses caused by power outages,” the FGD study showed.

 For Siargao, the study found that the prolonged power instability there has exposed systemic vulnerabilities in its tourism-dependent economy, incurring losses ranging from P15,000 to a high of P100,000 daily.

“Resorts in Siargao spend P60–70 per liter of fuel, while laundry businesses incur P3,500 per 8-hour shift on diesel. The December 2024 submarine cable power crisis caused millions in revenue losses during what should have been the peak tourism season,” the study said.

In Cebu, a whopping P216,000 in losses per day were recorded from large businesses, while MSMEs are reeling from P82,000 in daily revenue losses.

“Cebu, particularly large businesses, reported high monthly electricity consumption and costs due to their operational needs. While minimal immediate losses were reported, long-term concerns include the need for modernization of energy infrastructure to keep pace with rising demand. In contrast, Cebu benefits from more effective governance structures where power concerns are addressed through better coordination between utilities, local government, and the private sector,” the findings noted.

 Lastly, an average of P30,000 in losses for MSMEs in Puerto Galera is being attributed to power shortages, especially for the accommodation sector.

“The dependence on Mindoroʼs external power sources has led to frequent power interruptions, requiring businesses to invest in backup power systems. Puerto Galera's tourism establishments face similar challenges to Siargao and Samal Island, where prolonged blackouts force many businesses to issue refunds to customers and slash prices to maintain occupancy, significantly impacting profitability,” according to the study.

 With this, ILAW national convener Beng Garcia and youth convener Francine Pradez said power outages significantly damage the reputation of these destinations, with negative reviews and cancellations directly linked to electricity problems.

With tourism serving as a major economic driver in these areas, ILAW has called on electric cooperatives to improve their performance and ensure a reliable power supply that meets the present and future demands of their franchise areas.

“It’s time for our electric cooperatives to step up and ensure reliable and efficient power supply, especially in key tourism areas where businesses and livelihoods depend on stable electricity. Continued power instability threatens business sustainability, job security, and the long-term growth of the tourism sector. If this persists, businesses will have no choice but to shut down, leaving many without jobs,” according to Pradez.

 Further, the group called on the Department of Energy and the Energy Regulatory Commission to impose stricter accountability measures on electric cooperatives operating in tourism hubs.

Meanwhile, Manette Reyes, chief tourism operations officer of the Department of Tourism, said they are acknowledging the efforts of ILAW.

“The DoT, under the leadership of Secretary Cristina Garcia Frasco, is committed to supporting tourism developments by undertaking critical institutional reforms pursuing a whole-of-government approach and investing in long-term sustainable growth,” Reyes said.

The DOT said a total of 1.168 million foreign travelers visited the Philippines in the first two months of 2025, with South Koreans leading the arrivals, followed by Americans, Japanese, Canadian, and Australian visitors.