Press Release
August 3, 2016

Gatchalian Warns of Billion-Peso Losses from Luzon Brownouts

In response to recurring power supply problems on the Luzon grid since last week, Senate Committee on Energy Chairman Win Gatchalian urged the Duterte administration on Wednesday to immediately address the country's unstable power supply, explaining that a Luzon-wide power outage would cost the country 3.3 billion pesos in economic productivity per hour.

"Widespread power outages across Luzon would bring national economic productivity to a standstill. The Duterte administration must look into immediately expanding the power supply by tapping new energy resources." said Gatchalian.

The 3.3 billion peso estimate was computed from official 2016 first quarter gross domestic product (GDP) statistics released by the Philippine Statistics Authority (PSA) earlier this year. These statistics include potential losses from industries which rely primarily on grid power, including manufacturing, retail, trade, and the services sector.

However, sectors which usually have the expanded capacity to rely on self-generated power, including agriculture, quarrying, and construction, are not included in the figure.

Gatchalian said that stabilizing the Philippine energy supply would be one of his priorities as Senate energy chair, promising to work with Department of Energy Secretary Alfonso Cusi to create an integrated policy and legal framework which would facilitate the speedy addition of new resources to the Philippines's energy mix.

"We need to redouble our efforts to explore and exploit new indigenous energy resources, such as the abundant natural gas reserve in Reed Bank. Continued economic growth will depend on ensuring that our domestic industries have access to cheap and reliable electricity," Gatchalian explained.

Gatchalian also said that he would push for the immediate deployment of viable strategies to bring electricity prices down.

"Electricity is an integral part of contemporary Filipino life," said Gatchalian. "Making reliable electricity more affordable will improve the lives of millions of Filipinos. We must work towards easing the burdens of our countrymen and countrywomen."

In addition, Gatchalian affirmed his commitment to improve the functionality of the Wholesale Electric Spot Market (WESM), explaining that the Philippine Electricity Market Corporation (PEMC) and the WESM possess the tools to closely monitor trends and market fluctuations in the energy generation sector for public benefit.

"PEMC and WESM can provide us with the information necessary to detect collusion and other forms of non-competitive behavior in the market. Their information can prove instrumental in protecting the interests of Filipino consumers," said Gatchalian.

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