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Gatchalian: boost competition in RE sector to lower power costs

​MAKATI, Philippines – Sen. Win Gatchalian (3rd from left) poses with key solar industry players at the recent formal launch of the Confederation of Solar Developers of the Philippines (CSDP) that seeks to unify and strengthen the thriving renewable energy sector. The senator has called on bureaucratic reforms to ease entry of new investments on power generation to the country. (Photo by Mark Cayabyab/OS WIN GATCHALIAN)

The time has come to foster greater competition in the domestic renewable energy industry to lower electricity costs for consumers, Senator Win Gatchalian declared on Monday.

“Swift technological developments have brought us to the point where renewable energy sources can match the production and cost efficiency of conventional power sources such as coal, hydro, and natural gas. The next step should be to inject true competition into the game. More competition, with a wide array of foreign and domestic RE players battling one another to produce clean energy at lower costs, will allow us to slash power rates throughout the country,” he said.

Gatchalian, the Chairman of the Senate Committee on Energy, pointed out a global trend of decreasing solar energy prices over time as a result of competitive bidding regimes instituted by other countries in their RE sectors, citing countries such as Mexico, which offers solar power rates at P1.33/kWh; Chile, at P1.44/kWh; the United Arab Emirates, at P1.48/kWh; El Salvador, at P2.46/kWh; and Zambia, with rates at P2.99/kWh.

As a domestic example, Gatchalian highlighted the cost efficient P4.69/kWh rate that Meralco has contracted with Power Source First Bulacan Solar Inc. under a private power supply agreement, which he says is an indicator that local companies using advanced RE technology can produce clean electricity at rates significantly lower than before.

“The interest of the public, particularly the power consumers, should remain the government’s primordial concern. The government should grab this opportunity to level the playing field and encourage new RE players, both local and foreign, to enter the game. Efforts should be made to make power cheaper, rather than on making it more expensive through subsidies given to private investors,” said Gatchalian.