The United Filipino Consumers and Commuters (UFCC) said the partnership of three business conglomerates in the liquefied natural gas (LNG) industry effectively monopolizes the and may put upward pressure on power rates.
UFCC was referring to the partnership of Meralco Power Gen Corp. (MGen), Aboitiz Power Corp. and San Miguel Global Power Holdings Corp. (SMGP) for the country’s first and most expansive integrated LNG facility in Batangas. The deal which values the entire enterprise at $3.3 billion provides MGen and Aboitiz Power will jointly invest in two of SMGP’s gas-fired power plants including the 1,278 megawatts (MW) Ilijan power plant and a new 1,320 MW combined cycle power facility.
The three companies will then acquire the LNG import and regasification terminal of Linseed Field Corp. that will be used to receive, store and process LNG fuel for the two power plants.
Rodolfo Javellana Jr., UFCC president, said the partnership will “maximize profits” of the three companies and will also “tighten” the grip on the local LNG industry that could negatively affect consumers in terms of power rates.
“This was further worsened by the regulatory capture of government agencies that should have been acting as check and balance and defending the 8 million consumers held hostage by constant price hikes… The public cannot hope for any redress in the future as they can only expect costlier electricity,” Javellana said.
UFCC added this development only reinforces the need to repeal or amend the Electric Power Industry Reform Act which has policies that contribute in the high cost of power in the country. -Jed Macapagal