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THREE
‘”major blunders” by the government in energy policy are
now taking their toll on Filipino oil consumers. These
are the dismantling of the state energy complex, the
subsequent deregulation of oil during the administration
of former President Aquino and the sale of a controlling
bloc of Petron shares to foreign interests during the
administration of former President Ramos.
This is
the view put forward by civil-society activists Maitet
Diokno and Walden Bello, who spoke on Tuesday at a forum
on oil and price issues, where the Freedom from Debt
Coalition (FDC) also assailed Malacañang’s P500 cash
subsidy to poor families, saying this is not the
solution to the skyrocketing cost of oil and
electricity.
The
government,
Bello said, should undo the last and the biggest blunder by
regaining controlling interest and management control of
Petron, citing the significance of state influence on
some 35 percent to 40 percent of the market.
At the
forum, entitled, “Consumer Crisis: The Case of Oil and
Electric Power,” in Quezon City, the FDC presented its
proposals on ways to reduce electricity rates.
Diokno,
former president of the FDC and currently an honorary
member of the FDC board of trustees working group on
power under the National Advocacy against Privatization
of Essential Services and Commons, said the six
government measures that could bring down rates by as
much as 64 centavos are not enough to make electricity
rates decline.
The
government measures include asking the distribution
utilities to absorb the value-added tax (VAT) on system
loss starting July, and mandating the local government
units to use 30 percent of their share of the national
wealth tax.
Instead
of these, she batted for removing “taxes on taxes,” such
as VAT and royalty on renewable energy, and enforcing
least-cost provision—measures that her group calculates
could reduce power rates by as much as P3.30.
“The
Philippines is a Third World country with the
electricity rates of the First World. Having to pay a
large amount even for electricity that has not been
generated nor consumed, or charged for the highest cost
of power purchased from the postmarket that does not
work, are vivid examples of how power rates in the
country have gone wayward, imposing undue burden on the
life of poor Filipinos,” Diokno said.
She said
the power play between the majority Lopez bloc in the
Manila Electric Co. (Meralco) and government
representatives led by Government Service Insurance
System president Winston Garcia is not about rates but
the strategic control of the country’s largest
distribution utility. She added that whoever controls
Meralco controls the power industry, with Meralco
accounting for 70 percent of Luzon’s electric
distribution service.
Bello, currently FDC’s president and a senior researcher of
the Focus on the Global South, sees the price of fuel
continuing to hit sky high with the global dependency on
oil.
He said
the demand for oil is rising much faster than its
supply, because old oil fields, on which the world
relies for most of its oil, are being depleted; and no
new fields have been discovered that can match their
production reserves. He said the removal of VAT should
be accompanied by a measure of deregulation.
“The
companies must obtain the government’s permission to
raise prices. To determine whether the proposed price
increase is fair and reasonable, the government must
have access to the oil companies’ costing data,” he
added.
This,
Bello said, is not meant simply to control prices but to
correct the current situation of “windfall profits” and
make the major oil companies share the burden of the
rise in the price of crude with the consumer, rather
than passing this all to the latter.
He also
proposed the need to start a radical shift from oil to
electric power in transportation.
Priority, he added, must be placed on expanding the
electricity-run train and bus transportation system,
with the necessary investments coming from resources
that would not go to debt-service payments.
“This
expansion could be coordinated with the popularization
of the use of bicycles for relatively short distances
from stations to residences or the offices,” Bello said.
While
the shift from oil to electric power is not yet
feasible, he said, “we must convert a significant part
of the bus and jeepney fleet from gasoline and diesel to
cheaper gas, such as liquefied petroleum gas, with
incentives to convert private vehicles for such
purpose.” |
