Lawmaker says more competition in RE can lower power rates

Lawmaker says more competition in RE can lower power rates

Greater competition and a balanced playing field in the renewable energy (RE) industry is the key to lower electricity costs for consumers, Senator Sherwin Gatchalian said yesterday.

“Swift technological developments have brought us to the point where renewable energy sources can match the production and cost efficiency of conventional power sources such as coal, hydro, and natural gas,” said the senator, who is also the chairman of the Senate Committee on Energy.

So far, the government has not expressed interest in expanding the Feed-in-Tariff (FIT) scheme. RE developers are looking for other options that can level the playing field in which they can compete with conventional power projects like coal.

The lawmaker said the Manila Electric Co. (Meralco) signed a private supply agreement with Power Source First Bulacan Solar Inc. with a P4.69 per kWh rate.

He said this means local companies with advanced RE technologies can produce clean electricity at even lower rates.

“The next step should be to inject true competition into the game. More competition, with a wide array of foreign and domestic RE players battling one another to produce clean energy at lower costs, will allow us to slash power rates throughout the country,” Gatchalian said.

Decreasing costs worldwide

He pointed out that solar energy prices worldwide continue to decrease as a result of competitive bidding regimes laid by the RE sectors of other countries.

Gatchalian cited countries like Mexico, with solar power rates at P1.33 per kilowatt-hour (kWh); Chile with P1.44 per kWh; the United Arab Emirates at P1.48 per kWh; El Salvador at P2.46 per kWh; and Zambia with P2.99 per kWh.

“The interest of the public, particularly the power consumers, should remain the government’s primordial concern. The government should grab this opportunity to level the playing field and encourage new RE players, both local and foreign, to enter the game. Efforts should be made to make power cheaper, rather than on making it more expensive through subsidies given to private investors,” he said.

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  1. Elmer B. Sambo

    The key to the lowering of the electricity cost is to lower the power generating, transmission and distribution cost. These three (3) components is 80% of our electric bill. Reducing this cost by half will result to 60% reduction in the electric bill! This is where the senator should focus if he wants reduction in the cost of electricity. Of course this can be reduced further with the use or renewable energy in the future as cost of renewable energy equipment or hardware continually drops.


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