The government will grant Samsung Electro-Mechanics Philippines Corp. (SEMPHIL) preferential power rates for its proposed $1 billion investment in the Philippines.
Philippine Economic Zone Authority (PEZA) Director General Tereso Panga said on Thursday the government-run Power Sector Assets and Liabilities Management (PSALM) will supply SEMPHIL’s power needs “at an approved subsidized power rate.”
Panga did not say how much lower the power rate will be, but added that “discussions are ongoing.”
Panga said SEMPHIL plans to expand its existing facility at the Calamba Premiere Industrial Park in Batino, Calamba, Laguna, to produce multi-layer ceramic capacitors.
The arrangement will be somewhat similar to that of Texas Instruments in terms of its investment in Clark, he said.
Texas Instruments has been granted preferential or discounted power rates because of the magnitude of its investment and jobs created in the Clark ecozone.
This was authorized under Executive Order No. 666 of 2007 issued by then-president Gloria Arroyo.
When asked about the prevailing power rates for industrial customers, electricity distributor Meralco said there is no “one-size-fits-all” rate for such customers.
“The rates depend on the load, voltage, and demand of the industrial customer,” a Meralco spokesman wrote in a text message.
Earlier, on the sidelines of a PEZA event on Tuesday, Panga said the power rates incentive for SEMPHIL would have to be approved first by the Fiscal Incentives Review Board and then by the Office of the President, which would then issue the corresponding executive order.
This is under the implementing rules and regulations of the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) Act, which provides incentives to attract big-ticket investors like SEMPHIL and Texas Instruments.
The CREATE MORE IRR adds that the project or activity should have a minimum investment capital of P50 billion or its equivalent in US dollars, or a minimum direct local generation of at least 10,000 jobs to qualify.
Once the EO is passed, Panga expects SEMPHIL to register the investment with PEZA.
