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Hello gas, hello higher prices

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The Power for People Coalition on Saturday expressed dismay over the Department of Energy’s (DOE) upbeat statement on the completion of two liquefied natural gas (LNG) projects in the country, saying that the entry of gas ensures that the Philippines will be further away from energy security and consumers will suffer more from higher prices.

The DOE told the media on Friday that two LNG importation facilities – owned by Linseed Field Corporation and the FGEN LNG Corporation, respectively – are now online and able to accept imports. The decision to use gas allegedly as a bridge fuel for the transition to renewable energy was made even as world market prices remain volatile and the tug-of-war for supplies continues for the fossil fuel.

“Electricity sourced from gas is expensive, more so now if they are imported. There is nothing to welcome except more misery for consumers. The DOE’s delight over the importation of gas is misplaced and insensitive to Filipino consumers,” said Gerry Arances, P4P Convenor.

The LNG facility operated by Linseed supplies the Ilijan power plant of San Miguel Corporation (SMC). Despite breaking its contract with Meralco in the previous year over having been disallowed to raise prices, SMC was still given contracts to supply power at emergency rates by the distribution utility. From the Php 3 to 5/kWh that SMC was charging Meralco in its previous straight-priced power contract, the new emergency power supply agreement had a generation cost of over Php 8/kWh last month.

“Let us not forget that SMC itself cited its use of gas as the reason it needed to hike charges to consumers. It astounds us that gas is being pushed so aggressively by the government when renewable energy is available and is consistently cheaper than any fossil fuel,” said Arances.

The energy consumer advocate said the operation of the two LNG facilities also means more tankers passing through the vulnerable Verde Island Passage, a center of maritime biodiversity on which two million Filipinos depend on for their livelihood.

“Higher volume of tanker traffic means increased possibility of accidents. MT Princess Empress will not be the last if we have more fossil fuel ships in the area. Even now, the oil spill continues with the government helpless or unwilling to fix it,” Arances said.

“Moreover, the scale of plans the DOE and gas companies have for gas makes their alleged purpose of assisting a renewable energy transition questionable. The massive fleet of gas projects in the pipeline are in no way a transition, but a lock in to decades more of high electricity prices and dirty energy. Gas is bad news from every angle,” said Arances.

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