Business groups warn government not to give Solar Para sa Bayan edge over rivals

Photo of Leandro L. Leviste from CNN Philippines

BUSINESS groups on Wednesday asked President Duterte to allow his economic team to review the franchise bill of Solar Para sa Bayan Corp. (SPBC) on issues of competition and alleged lack of deliberation.

In a joint statement, business groups said granting Solar Para sa Bayan the franchise will accord it with competitive edge over rival renewable-energy firms operating in the Philippines. Citing competition concerns, they appealed to the President to pass on House Bill 8179, the franchise measure, to his economic managers for their assessment.

Solar Para sa Bayan, owned by Leandro L. Leviste, son of Sen. Loren B. Legarda, has been granted by Congress a 25-year-franchise to put up and operate solar grids in remote and unviable, unserved and underserved areas in the country.

“This [HB 8179] will make less viable the operations of the other renewable-energy companies and qualified third parties, which have been operating after compliance with substantive and formal requirements set by law. In other words, the grant of the franchise may defeat the President’s objective of leveling the playing field in the renewable-energy sector and could prejudice power consumers,” the statement read.

“We understand that Solar Para sa Bayan’s franchise bill was approved so swiftly and, thus, may have been approved without sufficient deliberation to thresh out fundamental constitutional, legal and economic issues,” it added.

The House of Representatives and the Senate on June 4, one of their last sessions before sine die adjournment, ratified the franchise bill. The measure was ratified in spite of objections from Sen. Sherwin T. Gatchalian, who opposed an insertion in the bicameral report, which he argued “will negatively affect the power industry.”

“This insertion is in the definition of an underserved area, which will now include areas ‘where electricity services have been interrupted at least 12 times in the 12 months preceding the date of the determination that such area is underserved,’” Gatchalian said in his objection speech.

Business groups said Duterte approving the franchise bill will put Solar Para sa Bayan’s competitors at a disadvantage. As a resolve, they asked the President to leave the dirty work of reviewing the measure’s impact on competition, as well as to consumers, to government economists.

“In view of the impact of Solar Para sa Bayan’s franchise bill on small, mini and micro grids now operating in the country, as well as to the power consumers in general, we appeal to His Excellency to have the members of the economic cluster of the Cabinet review this franchise bill prior to any executive action,” the statement read.

The joint statement was signed by the American Chamber of Commerce of the Philippines, Financial Executives Institute of the Philippines, Makati Business Club and the Management Association of the Philippines. The Semiconductor and Electronics Industries in the Philippines Foundation Inc. and the Women’s Business Council Philippines also signed the statement.

An online petition launched by nonprofit Philippine Solar and Storage Energy Alliance is asking the return of HB 8179 to Congress for it to be deliberated again.

The petition claimed the franchise bill has no electrification obligations for Solar Para sa Bayan, will favor only one firm, will eliminate competition and was approved by lawmakers without due process and only after one public hearing. It is targeting to garner 10,000 signatures, and has 7,666 as of writing.

In its web site, Solar Para sa Bayan claimed an estimated 12 million Filipinos lack access to electricity as of 2016. This translates to 10.4 percent unelectrified households in the whole of the Philippines. By island, 5.2 percent of households in Luzon is in need of power access, 7.6 percent in Visayas and 27.6 percent in Mindanao.

The Department of Energy is eyeing to achieve 100-percent electrification by the end of Duterte’s term in 2022. 

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