AN UPBEAT economic activity and development could be expected to result from the power-reform bills authored by Senate President Juan Ponce Enrile.

This is what the senator told energy reporters in a press conference on Thursday, citing indications of support from several foreign chambers of commerce and other industry groups.

Enrile authored Senate Bills 3147 and 3148, or the Uniform Franchise Tax Act and the Electricity Rate Reduction Act, respectively, which are aimed to cushion electricity consumers from another electricity-price increase.

Senate Bill 3148 aims to reduce the royalties collected by the government from indigenous energy sources to 3 percent from 60 percent of net proceeds from the sale of such energy sources to lower electricity rates, while Senate Bill 3147 will instead charge a uniform 3-percent franchise tax on the distribution income of distribution utilities in lieu of all national and local taxes.

Senate Bill 3148, according to Enrile, has been approved on second reading and has been renamed Senate Bill 3282.

Enrile said, upon resumption of the Senate, they will do roll call vote on the said bill—which will become a fait accompli as far as the Senate is concerned.

Enrile also noted that President Arroyo has also indicated her support to the said bill.

Enrile said the passage and enactment of the bill would result in the removal of the cross subsidy given to the marginalized sector or lifeline-rate users using 100-kilowatt-hours (kWh) and below —who are subsidized by the rest of the households and industries.

The proceeds from the 3-percent royalties, according to Enrile, will be used as a subsidy to provide relief to households and industries subsidizing the consumption of the marginalized users.

“In essence, you relieve the households from the burden of that subsidy and give them a free income that they can use to consume goods and services—which will eventually redound to the economy—that will be subject to value-added tax, income tax,” Enrile said.

He added that it will also enhance economic movement and activities in the country.

Enrile noted that the real beneficiaries of this proposal would be the industries, particularly semiconductor and electronics industries.

Enrile also noted that the various foreign chambers of commerce have also assured him  that if the bills are enacted into law, it will help them maintain the jobs of workers they are now currently employing and encourage other investors to come back and invest their capital in the country.

 Meanwhile, Enrile also said the claims of the Department of Energy (DOE) that his proposed measures will not significantly impact on the industrial sector are based on erroneous data.

“The Senate Committee on Energy has established that the DOE’s claims are inaccurate and are actually based on erroneous data. The DOE representatives have apparently not done their homework,” Enrile said.

The Senate leader added his proposed measures will directly result in lower power rates that will range from P1.34 to P2/kWh for business or industrial users and at least P1/kWh for residential consumers.

Enrile also scored the Department of Finance for opposing any legislative measure that will in anyway reduce existing government revenue sources. “The DOF should be more circumspect in studying the comprehensive and overall impact of any proposed legislation,” he added.

“Senate Bill 3282 will provide the stimulus that our local economy needs to survive the onslaught of the prevailing global crisis. Lower power rates will make local industries more competitive and give consumers more disposable money to pump-prime the economy. The combined effect will more than compensate for the reduction in royalty taxes,” Enrile said.