‘ILP to cost power consumers P450 M’

MANILA, Philippines - The so-called interruptible load program (ILP), which aims to ease the projected electricity shortage in Luzon next summer, will cost taxpayers P450 million, Energy Secretary Jericho Petilla told congressmen yesterday.

He informed the House committee on ways and means that based on this year’s power outages, his estimate of the cost of ILP between March and July 2015 would be P90 million a month or P450 million for five months.

It is during the five-month period that the Department of Energy (DOE) is projecting a shortfall in desired reserves in Luzon, though supply would be almost sufficient to meet demand.

Under ILP, private companies with generating sets would be asked to disconnect from the grid and run their own generators. They would be reimbursed for a part of their cost, and the fuel they would use would be exempt from the 12-percent value added tax (VAT).

The DOE chief said the estimated P450-million cost of the program includes the amount of foregone VAT on fuel.

He said he would recommend to President Aquino that the reimbursements be sourced from the either the Malampaya Fund or the contingent fund in the national budget.

Last Tuesday, the House energy committee voted to endorse the joint congressional resolution granting President Aquino emergency or special powers to deal with the forecast Luzon electricity shortage.

The resolution focuses on the ILP tack to fill the shortage if ever there will be one.

Under the program, the government would reimburse participants for “fuel expenses and reasonable recovery.”

Isabela Rep. Rodolfo Albano III, one of the minority bloc’s representatives in the energy committee, said ILP participants should be reimbursed only for the difference between the cost of running their generators and that of the electricity taken from the Luzon grid.

“The government cannot return the entire cost of their fuel, because that would mean that they will get electricity free of charge, courtesy of taxpayers,” he said.