Am Cham appeals for 'fair return on
investments' in power sector
Philippines Star, 21 January 2004
By DONNABELLE L. GATDULA
The American Chamber of Commerce (AmCham) has echoed the appeal to "allow power utilities a fair return on investment so that we can look forward to a sustainable and viable energy sector."
AmCham made this statement after the Supreme Court stopped the Energy Regulatory Commission (ERC) from allowing Manila Electric Co. (Meralco) to increase its electricity rate by 12 centavos pe r kilowatt-hour.
"We think that MeraIco should be allowed to increase rates so it could recover losses and get a fair rate of return," said Robert Sears, executive director of AmCham.
MeraIco, whose franchise covers Metro Manila and nearby provinces is the largest electricity distributor in the country, It has over four million subscribers.
"If we let the market forces work the Philippines will become more attractive to foreign investors in the long run," Sears added.
AmCham has cautioned that the country may experience power outages similar to what happened in the early 1990s if no new investments are forthcoming in the ener gy industry.
The group echoed the sentiment of other investors who said they would only put in money if they are given a fair rate of return and allowed to recover losses.
The business chamber is also pushing that power distributors be allowed longer power supply contracts (10 to 15 years) with the National Powe r Corp. so that funding-institutions can also actively participate in financing energy generation an d operation projects.
AmCham represents some of the biggest energy cornpones operating in the country which include Mirant Philippines, Quezon Power, San Roque, and Chevron Texaco.
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