Price hikes recorded in June for select consumer items will likely result in increased electricity rates.
This was the opinion of some power firm execs as the country reels from recent changes in the market, particularly from oil and petroleum-based products.
“I believe that much of the inflation is fuel related. So, if this is true, then electricity prices will eventually go up,” Aboitiz Power Corp. President Antonio Moraza said to Business Mirror in a text message.
June recorded at 5.2 percent inflation rate, 0.6 percent percentage points higher than the previous month which stood at 4.6 percent. The last time inflation hit 5.2 percent was in October 2011.
Energy Development Corp. Vice President for Finance Erwin Avante told Business Mirror via text message that higher inflation rate will affect power rates. “Some power contracts, as I understand it, have provisions linked to inflation.”
Semirara Mining and Power Corp., Chief Executive Officer Isidro Consunji also shared the same view, saying “increased energy prices caused a big fraction of the inflation.”
Meanwhile, consumer group Laban Konsyumer Inc. (LKI) urged the Department of Energy (DOE) to promote the use of indigenous energy resources to help lessen the burden of price hikes on consumers.
“The DOE should revive the well-tested program of using more indigenous energy resources,” the group said. “Find more oil, natural gas and geothermal energy.”
LKI also called for a review on the renewable energy law to make RE cheaper, adding the the feed-in-tariff allowance system must be repealed.