SEIPI, PEZA seek expansion of ecozone rate scheme

MANILA, Philippines - The Manila Electric Co. (Meralco), the Philippine Economic Zone Authority (PEZA) and the Semiconductor and Electronics Industries in the Philippines Inc. (SEIPI) have requested the government to extend the special rate being offered to ecozone locators until Dec. 12, 2012.

In separate letters to the state-owned National Power Corp., Meralco, PEZA and SEIPI said extending the “Ecozone Rate Program” (ERP) would benefit the economy and the country as a whole.

ERP is an offshoot of a memorandum of agreement (MOA) between Meralco and Napocor which provides for the Provision of Generation Rates for High Load Factor PEZA-Accredited Industries signed in Sept. 19, 2007 and will expire once the transition supply contract (TSC) between the two firms ends on Dec. 25, 2011.

In his letter to Napocor president Froilan Tampinco, a copy of which was obtained by reporters, Meralco senior executive vice president and chief operating officer Oscar Reyes said, “the extension of the ERP will help promote and extend the laudable objectives of Republic Act 9136 to help achieve operational and economic efficiency and enhance competitiveness of Philippine products in the global market.”

“We note that the ERP has benefited industrial customers of Meralco who have been driving force behind the continued improvement of the economy,” Reyes said.

Currently, Reyes noted the ERP benefits 279 customers in industrial areas. These customers contribute 43 percent of the total Philippine manufacturing exports or around $19 billion and provide more than 222,213 jobs. 

“Considering the benefits of the ERP to the economy and the country as a whole, there is a greater reason and necessity to extend the term of our MOA to ensure an affordable supply of power to vital industries and thus enhance their competitiveness in the global market,” the Meralco executive said.

Meralco had written Napocor about the extension in April 7, 2011, as the power distributor knew that the ecozone program would fall away along with the expiration of the Meralco-NPC TSC.

As of this moment, it was learned that Meralco has not yet received any formal reply from Napocor.

“We are hoping that the ecozone program could be extended until the new open access date (whenever that will be declared by ERC), as this would provide a smoother transition to open access for customers under the ecozone program,” Meralco said.

PEZA Director General Lilia de Lima, for her part, said the extension would ensure the ecozone locators a steady supply of power while awaiting for the implementation of open access and retail competition.

“This will also enable ecozone export producers to focus on their business and even expand their production operations as they need not be bothered by the projected supply shortage in the Luzon grid and other uncertainties with the forthcoming implementation of retail competition and open access,” De Lima said.