VP Binay: Power rate hike looming if Malampaya reserve not replaced

Vice President Jejomar C. Binay has warned that the country may again suffer sharp power rates if a new gas reservoir does not replace the existing Malampalaya natural gas reserve soon.

“We only have one Malampaya that already supplies at least 40 percent of electricity requirements of Luzon. If a new gas reservoir or LNG (liquefied natural gas) does not replace Malampaya soon, we may yet suffer again another sharp increase in electricity rates like what we experienced in November last year,” Binay said during the 2014 Natural Gas Summit at the New World Hotel.

Binay said the government should focus its energy policies toward further development of the natural gas industry in the country.

The vice president that mainstreaming natural gas and LNG should form bulk of the developmental energy program of the government.

“Their utilization must still be on the forefront – issues like technological maturity, economic efficiency, reliability of supply, adequacy of investments, and availability of support structures must be confronted with our absolute commitment,” he said.

Natural gas, Binay said, should be considered as a fuel source because it produces much less carbon emission than coal, bunker fuel, or diesel.

“[W]e have seen in other jurisdictions that gas-fired power stations are also cheaper and easier to build than nuclear,” he added.

“Finally, natural gas is generally accepted in Europe as a transition fuel and then as a reliable and lower-carbon back-up source to ensure a continuous power supply when the conditions are not right for renewable energy technologies such as wind turbines and solar panels to generate electricity,” he further said.

The Vice President said both the executive and legislative branches of the government should “contemplate additional measures to make the Philippines an even more attractive place for gas investors.”

“We should review decades old laws such as Presidential Decree No. 87 and the DOE Circular on Natural Gas to make them more in sync with modern times,” he added.#