Weak peso threatens higher power bills

SINGAPORE — Higher electricity bills could be creeping into Filipino households as the peso slipped to a record low of P64 against the United States dollar, threatening to drive up power generation costs and pile more pressure on consumers already grappling with expensive energy.

Energy Secretary Sharon S. Garin warned Tuesday that the weaker peso would make imported coal, diesel, and liquefied natural gas more expensive, with the additional costs eventually reflected in electricity rates.

Impact the per kilowatt-hour

“Indirectly, it will impact the rate of electricity because pass-through siya. So, it will impact the per kilowatt-hour,” Garin told reporters on the sidelines of the Singapore International Energy Week.

To cushion consumers from another price shock, Garin said the Department of Energy (DoE) would coordinate with the Energy Regulatory Commission (ERC) to explore ways to delay or soften potential electricity rate increases.

“We will check if there is any way we can delay or maybe lessen the impact. But that is something that I have to discuss with the ERC because they determine the rates,” she said.

The weakening currency adds to mounting pressures on electricity consumers, with the energy sector also confronting volatile oil prices, possible El Niño conditions, and higher power demand during the coming summer months.

The combination of challenges even prompted Garin to joke about the timing of her appointment.

“We have the oil crisis, we have the currency, we have El Niño, and the coming summer, too. This is not the best time to be Secretary,” she said.

Garin acknowledged that existing regulations could limit immediate government intervention but said relief measures, including subsidies, could be considered if the impact on consumers becomes severe.

“So if the impact is really significant, we can report it to the committee and the Cabinet, and subsidies may be provided through the Departments of Environment and Natural Resources, Agriculture, or Transportation,” she said.

However, no such intervention has been proposed at this stage.

Motorists could also face higher fuel costs as the peso’s depreciation makes imported petroleum products more expensive.

Stagger fuel price adjustments

Garin said the DoE may again ask oil companies to stagger fuel price adjustments to ease the burden on consumers, depending on the agency’s computations this week.