PhilStar 55, More connectivity, more prosperity and DICT

More connectivity, more prosperity and DICT

ENERGY, INFRA AND ECONOMICS - Bienvenido Oplas Jr. - The Philippine Star 

August 21, 2025 | 12:00am

https://www.philstar.com/business/2025/08/21/2466887/more-connectivity-more-prosperity-and-dict

 

“As of 2022, only 77 percent or 20.6 million households were connected to the Internet. This is much too low. Together with our private sector partners, we will efficiently harness the concept of common towers to provide connectivity to Filipinos who are at the far end of the last mile.”

 

– President Marcos Jr., SONA 2024, July 22, 2024.

 

“Halos labindalawang libong pampublikong paaralan pa ang walang internet. Kaya sinisiguro ng DICT at ng DepEd na bago matapos ang taong ito, magkakaroon na ng koneksyon ng internet ang lahat ng pampublikong paaralan.”

 

– President Marcos Jr., SONA 2025, July 28, 2025

 

I checked the comparative internet connectivity of our neighbors in the ASEAN in 2022 and 2023, “Individuals using the internet as percent of total population” from World Bank’s World Development Indicators 2025 database, here are the numbers: Malaysia 97.4 and 97.7, Singapore 96 and 94.3, Thailand 88 and 89.5, Vietnam 78.6 and 78.1, Indonesia 66.5 and 69.2, Cambodia 58 and 60.7, Philippines 75.2 and 83.8.

 

So, the Philippines has the largest increase in internet connectivity in one year, good. And now a huge target of 12,000 public schools to have connectivity to be done by the Department of Information and Communications Technology (DICT) and Department of Education.

 

I checked recent reports in The STAR related to connectivity, a number of optimistic stories: “DICT backs Konektadong Pinoy Act” (July 17), “DICT to launch center vs scam websites” (July 28), “Marcos vows internet access for all public schools by end of 2025” (July 28), “DICT: Expect 60K free WiFi sites in 2026” (Aug. 5), “Inside Philippine gov’t’s plan to upskill workers in AI” (Aug. 11).

 

So there is very high expectations of new DICT Secretary Henry Rhoel Aguda as the President has assigned even higher achievements from him – all 12,000 plus public schools, plus another 12,000 plus rural health centers. Tall order.

 

I checked the budget allocation for DICT, from the Department of Budget and Management (DBM) Budget of Expenditures and Sources of Financing 2026, submitted to Congress last week.

 

DICT total budget are as follows: P14.8 billion in 2024, P15.1 billion in 2025 and P18.9 billion in 2026. Of which the infrastructure outlays are: P9.27 billion in 2024, declined to P6.51 billion in 2025, but rise to P12.14 billion in 2026.

 

It is good that DBM Secretary Amenah Pangandaman has added nearly P4 billion next year to DICT given the high expectations and high targets by Secretary Aguda himself. She cut the budget for flood control projects by DPWH among others, and added budget for useful projects like rural free WiFi by DICT. Good move, Ms. Pangandaman.

 

Aguda was appointed DICT Secretary last March; by June the DICT has activated 18,850 free WiFi sites, 6,180 of them in geographically isolated and disadvantaged areas under the Free Public Internet Access Program (FPIAP) which installs WiFi sites in government offices and schools. Plus rolled out 3,026 kilometers of fiber under Phases 2 and 3 of the National Broadband Program, and celebrated the passage of the E-Governance Act and the Konektadong Pinoy Act.

 

So 18,850 free WiFi sites in June, then 19,000 last July. I read from various sources his targets: at least 30,000 end of this year, and up to 50,000 in 2026, up to 70,000 in 2027, and more, bring connectivity to more Filipinos. The target to cover 12,000 public schools and another 12,000 rural health centers can be done this year. Help improve rural medical facilities to have access to internet to promote telemedicine use, store health records nationwide, among others.

 

I checked who is this guy Aguda to be given such a huge task nationwide and delivered quick results in his first three months in office. From various web sources I saw, he is half-decade younger than me in UP Diliman, finished BS Mathematics, proceeded to UP Law and graduated as class valedictorian.

 

Weird, a mathematician who enjoys abstract formula, Greek equations, infinity numbers and fractals, would go into law and endure reading perhaps hundreds of pages of words per day, and still excel to graduate as valedictorian. The guy has thick and dynamic grey matter between his ears.

 

He dreams of “Digital Bayanihan” – that government, private companies, academe, and communities to work together to close the digital divide, connect the farthest barangays, power the growth of homegrown tech startups, create millions of digital jobs for a workforce who can compete and thrive in the global arena.

 

Nice dream. Increased connectivity nationwide means that even remote communities will have access to more economic opportunities, from outsourcing, e-commerce, app development, or even government tech services.

 

As a former telco executive, Aguda is said to want more transparency within the industry. He also wants to require every government agency and local governments to adopt digital services via the eGov SuperApp, which now houses several government services. The app won the United Nations E-Government Award from the UN Department of Economic and Social Affairs, has drawn over 14 million registered users and facilitated more than 200 million transactions nationwide.

 

More dreams – enable up to $9 billion in hyperscaler investments, secure digital systems through a national cybersecurity certification program, more affordable internet outside of free public WiFi. And a bold motto: “To the critics: test us. To the people: trust us. To the future: we’re already building it.”

 

Meanwhile this is another challenge to the Department of Energy and the private energy players – more power generation from reliable and non-intermittent sources, more electricity supply even to remote barangays.

 

More electricity plus more connectivity equals more economic opportunities, more prosperity for our people.

BWorld 815, On investment promotion and world peace

On investment promotion and world peace

August 19, 2025 | 12:02 am

My Cup Of Liberty

By Bienvenido S. Oplas, Jr.

https://www.bworldonline.com/opinion/2025/08/19/692278/on-investment-promotion-and-world-peace/

 

Last week, the Philippine Statistics Authority (PSA) released the data on approved foreign investments for the second quarter (Q2) of 2025. I checked and compared Q1 and Q2 2025 results over the same period in 2024.

 

The Board of Investments and the Philippine Economic Zone Authority remain the country’s largest investment promotion agencies (IPAs) and there has been a significant decline in total foreign investments, from P345 billion in 2024 to P95 billion in 2025.

 

The largest sources of investment last year were Switzerland with P235 billion and the Netherlands with P40 billion. This year the largest sources are Singapore and South Korea (see Table 1). 

 

The bulk of the foreign investments last year were in the Electricity, gas, and steam sector with P282 billion out of the P345 billion total, followed by Manufacturing with P25 billion. As to the destination of foreign investments, the bulk went to Calabarzon with P123 billion and Negros Island with P86 billion. This year, the Bicol region got P32 billion of the total P95 billion, followed by Calabarzon with P25 billion.

 

The past two weeks showed the President and some members of the economic team busy with various investment promotions. President Ferdinand R. Marcos, Jr. and several Secretaries were in India and among the events held there was the Philippine-India Business Forum in Bengaluru, on Aug. 7.

 

Department of Finance (DoF) Secretary Ralph G. Recto was among the speakers in that forum and he said that: “The Philippines is the natural hub for Indian companies in IT, fintech, blockchain, AI, and BPO looking to expand their operations in Southeast Asia.” There were around 160 Indian investors from key sectors such as IT-BPM, manufacturing, infrastructure, and healthcare, among others.

 

On Aug. 13 in Manila, Mr. Recto met with the officials from the Sumitomo Mitsui Financial Group led by its President and Group CEO Toru Nakashima who expressed their confidence in the Philippines. And on Aug. 14, Mr. Recto also met with the US-ASEAN Business Council (US-ABC) members, led by its Senior Vice-President and Regional Managing Director Ted Osius, and discussed recent investment liberalization measures.

 

The Philippines is not as attractive a destination as many of its East Asian neighbors when it comes to getting foreign direct investments (FDI), partly because of our geography, poor infrastructure including power generation, and governance. Two decades ago, in 2004, the Philippines had an FDI inward stock (instock, cumulative for FDI inflows minus outflows yearly) value of $12.7 billion. This rose to $56.6 billion in 2014 and $125.5 billion in 2024 (see Table 2).

 

A number of East Asian nations have had modest FDI instock because they transformed into net exporters of capital. In 2024 Taiwan had instock of $148 billion but outward stock (outstock) of $532 billion. South Korea had instock of $287 billion but outstock of $763 billion. And Japan had instock of $220 billion but outstock of $2,151 billion. China is quickly transforming into net exporter of capital, its outstock was only $883 billion in 2014 but expanded to $3,118 billion in 2024, an increase of $2.24 trillion in just one decade.

 

Foreign investors always partner with domestic investors, suppliers, and contractors. Hence, FDI expansion means domestic investment expansion, more jobs created, more taxes collected, and more infrastructure projects funded.

 

One good thing going for us is that the Ukraine war will end soon. The Trump-Putin meeting last Friday in Alaska resulted not just in a ceasefire plan but a peace plan. Not just a temporary halt to the war but ending the war. Ukraine’s President Volodymyr Zelensky will meet with US President Donald Trump in Washington DC on Monday, and if he agrees with the Trump-Putin agreement — and he likely will because there are big costs to him if he does not — a formal peace plan can be announced by the three leaders as early as this week.

 

Countries and governments should focus on peace and prosperity and not war mongering. They should focus on commerce, investments, and tourism, on more cargo ships not battleships, on more commercial planes not fighter jets, on more trucks and backhoes not more battle tanks. All conflicts, especially those related to territorial disputes between and among neighbors, should prioritize diplomacy and de-escalation, not escalation of conflict.

 

Last week, Aug. 14, marked the 80th year of Japan’s surrender and the end of World War 2, although Sept. 2 is the official date of the end of the war. Humanity has progressed over 80 years of having no world wars. We should push for 90 years, 150 years, or longer of having no world wars. More investment and trade among countries is an important aspect of this goal.

Energy 186, Blackout in Boracay, Siquijor

Boracay, perhaps the #1 or #2 (next to Cebu) tourism destination of the PH aside from M.Manila. Yesterday they have blackout whole afternoon and perhaps until evening.

Last May 12 they also have blackout at least 18 hours.

Last Aug 4 they have blackout drills in Boracay, like this story, https://www.boracayislandnews.com/ngcp-strengthens-grid-readiness-with-annual-blackout-drills/.

Just one whole afternoon of blackout and tourists can spread the word easily worldwide, that Boracay or other PH tourism destination can be inconvenient.

On Siquijor blackout, this is from the Press Statement of DOE Secretary Sharon Garin last August 29:

Many other island-municipalities and -provinces still suffer from regular blackout.

When do we realize that we should target huge increase in power supply regardless where the electricity comes from, instead of targeting 35% RE by 2030, 50% RE by 2050 etc. RE targeting is blackout targeting, kill coal and gas then the denominator goes down and ramp up the numerator, solar wind, ergo our RE/total generation reaches 50%. This is an ugly energy planning.

Boracay, Siquijor, other islands should have their own coal plants, instead of all big hotels and restos having their own big gensets running on diesel. Or Boracay getting coal from far away Iloilo City (the coal plant there also serves Negros island) or from unreliable wind farm in the mountains of Nabas, Aklan. That wind farm on mountains owned by PetroWind, they killed millions of trees in the construction  of mountain roads wide enough to accommodate two-way 10-wheeler trucks, and 18-wheeler long trucks that carried long wind blades, wind towers etc. Kill trees to "save the planet" wind power, ewww.

I envy VN, TH, ID, SG, MY. They keep attracting more tourists and many of those temporary visitors become long-term investors. Their hotels and resorts are not bothered by blackout.

Here is a good report from my friend, Eric Jurado,

"Southeast Asia’s Hotels, Resorts, and Travel Industry Revival: Who Leads, Who Lags, and What Comes Next"

ERIC JURADO, SEP 14, 2025

https://theinternationalinvestor.substack.com/p/southeast-asias-hotels-resorts-and

"Conclusion

Southeast Asia’s hotels, resorts, and travel services industry is undergoing one of the fastest recoveries in the global tourism landscape. For investors, the picture is clear:

 

* Indonesia is the future earnings powerhouse.

* Thailand is the revenue and current earnings anchor.

* Vietnam is the high-growth frontier with untapped potential.

* Singapore is the stable premium niche but slowing.

* Philippines is the smaller niche but improving.

* Malaysia remains troubled."

---------------

See also: 

Energy 183, Costly offshore wind on the retreat, July 21, 2025

Energy 184, US PJM's 'Max Generation Alert', July 25, 2025

Energy 185, Rising coal use in Asia especially Vietnam, China, India, July 31, 2025

BWorld 814, Global growth and changing share in GDP

Global growth and changing share in GDP

August 12, 2025 | 12:02 am

My Cup Of Liberty

By Bienvenido S. Oplas, Jr.

https://www.bworldonline.com/opinion/2025/08/12/690794/global-growth-and-changing-share-in-gdp/

 

Last week the Philippine Statistics Authority (PSA) released three important pieces of data: GDP performance in the second quarter (Q2) of 2025, which was 5.5%; the inflation rate in July, which was 0.9%; and the unemployment rate in June, which was 3.7%.

 

The GDP growth of 5.5% was the third fastest among the top 50 largest economies in GDP size that have reported their Q2 data so far. This is next to Vietnam and Taiwan that both grew by 8%. India has yet to release its Q2 data and it will likely be higher than the Philippines’.

 

The inflation rate of 0.9% was a six-year low for the country, and similar to Singapore’s 0.8%. It was lower than Malaysia’s 1.1%, Taiwan’s 1.5%, South Korea and India’s 2.1%, Indonesia’s 2.4%, Vietnam’s 3.2%, and Japan’s 3.3%.

 

Our unemployment rate of 3.7% was similar to Hong Kong’s 3.5% and lower than Indonesia’s 4.8% (March, no June data is available yet), or China’s 5% and India’s 5.6%.

 

The government’s economic team deserves praise as they are able to sustain the growth momentum while keeping unemployment and inflation rates at low levels. I quote here from the press statements of three Cabinet Secretaries.

 

Finance Secretary Ralph G. Recto stated that: “The back-to-back good news — low inflation rate, vibrant labor market, and strong GDP growth — are very encouraging…. tuloy-tuloy po kami sa aming trabaho hangga’t ang ginhawa ay hindi lang nakikita sa datos, kundi nasa hapag, nasa bulsa, at nasa kinabukasan ng bawat pamilyang Pilipino. (We will continue with our work until the ease and relief is not only seen in the data, but also on the table, in the pocket, and in the future of every Filipino family).”

 

Budget Secretary Amenah F. Pangandaman optimistically projected that: “We anticipate growth to accelerate in the second half of the year and settle within the 5.5% to 6.5% target range by the end of the year, driven by strong domestic demand and sustained public investment.”

 

Economics Secretary Arsenio M. Balisacan summarized: “Our continued economic expansion reflects not only the success of our policies, but also the resilience, creativity, and determination of the Filipino people.”

 

I have compared the average Q1-Q2 growth of 2025 over the last two years, for major economies that have Q2 data already. The Philippines has the third fastest growth so far, while South Korea, Germany, and Austria are the laggards (see Table 1).

 

I was personally expecting growth of 6% in Q2, and other economists projected growth of 5.7-6%. What prevented the country from growing faster than 5.5%? To figure this out, I checked the PSA time series quarterly data from 2000 to 2025. I chose a five-year interval for both GDP demand side and GDP supply side.

 

On the demand side, household consumption was 77% of total GDP in 2005, and this declined to 71% in 2025. But while household consumption is still the largest component of GDP, its growth is decelerating. Government consumption, on the other hand, is rising, from 11% in 2005 to 17% in 2025, and growth is high at 14% in 2025. Investments or gross capital formation also increased its share, from 17% in 2005 to 24% in 2025, but growth is decelerating.

 

On the supply side or industrial origin, there has been a decline in Agriculture, fishery and forestry (AFF), from 14% in 2005 to 8% in 2025. Industry also declined, from 31% to 29%, while the services sector keeps expanding, from 55% to 63% over the same period. Growth in both AFF and Industry is low while growth in services sector is high (see Table 2).

 

It is redundant to state this over and over again, but we have to keep growing fast, and we must attain an annual growth of 6% or higher for a decade at least. Both the industry and AFF sectors must grow faster than their recent performance, while the services sector only need to retain its high growth level.

 

More growth means more job creation and lower unemployment, more supply of goods and services, which all lead to lower inflation.

PhilStar 54, Stable electricity, prices and growth

Stable electricity, prices and growth

ENERGY, INFRA AND ECONOMICS - Bienvenido Oplas Jr. - The Philippine Star 

August 14, 2025 | 12:00am

https://www.philstar.com/business/2025/08/14/2465256/stable-electricity-prices-and-growth

 

The most expensive water is no water. The most expensive food is no food. The most expensive electricity is no electricity. Blackout is ugly and discomforting, anti-business and anti-people.

 

I checked global data on power outages, I saw at the World Bank database, one item there is “Firms experiencing electrical outages, % of firms.” For Asia, latest data in 2024: China 3.7 percent, S. Korea 4.7 percent, Malaysia 22.3 percent. Latest data 2023: Singapore 0.1 percent, Hong Kong 3.9 percent, Indonesia 12.7 percent, Vietnam 43 percent, Philippines 43.9 percent. Latest data 2022: Bangladesh 71.4 percent, India 19.9 percent, Saudi Arabia 2.7 percent. No data implying incidence of power outages is zero are Japan, United Arab Emirates, Qatar.

 

For America and Europe, latest data in 2024 unless specified: Canada 31.4 percent, US 25.2 percent, Belgium 33.5 percent, Sweden and Turkey 32.7 percent, Spain 18.8 percent, UK 14.3 percent, Italy 9.6 percent. France 29.5 percent (2022), Mexico 28.4 percent (2023), Germany 21.3 percent (2022).

 

It is surprising to learn that one-fourth of US firms have reported power outages, nearly one-third in Canada and France. In Philippines and Vietnam, more than two-fifth while only less than one-twentieth in China, Korea and Hong Kong.

 

Causes of power outages or fluctuation can come from generation (insufficient supply), transmission, distribution problems. Our power system should have resilience in these three sub-sectors of energy.

 

Last week Aug. 7, I attended the Energy Regulatory Commission turnover ceremony between outgoing chair Monalisa Dimalanta and incoming chair Nino Juan. Then we proceeded for the press conference.

 

During the question-and-answer session, I asked Mr. Juan: “As a consumer, I prefer stable electricity, no blackout even at higher prices because blackout means our refrigerator, aircon, lights can easily be damaged, will have to use candles, risky for fires. Another consumer wants cheap at all cost even with unstable supply, that if prices go up, ERC should impose price control, like the existing secondary price cap at WESM, and even a tertiary price cap if possible. Between the two of us, whom will you take side?”

 

Chair Juan nodded then replied that we need balance. There are many factors from the generation to transmission, distribution side that affect prices but we need stable electricity. He added that in off-grid areas like islands where people rely on gensets and Napocor’s SPUG, many consumers are willing to pay high just to have no blackout, P11 or P12/kwh in generation alone.

 

Recently there were lots of reports and stories about many electric cooperatives (ECs) having rates that are “cheaper than Meralco,” the National Electrification Administration (NEA) released the numbers as NEA is the main political protector of ECs, giving them lifeline money and subsidies for their losses and wastes and money taken from taxpayers.

 

Even assuming that the NEA narrative is true, price is a secondary factor for the welfare of consumers, power stability is their primary concern. Last Saturday I was in western Pangasinan, blackout there 6 a.m. to 6 p.m., many people were outside their houses because there was no light, no electric fan or aircon inside. Many coffee shops, convenience stores were closed, no aircon and lights. Blackout is ugly.

 

The ERC produces two important metrics (among many) that measure power stability or instability: the system average interruption duration index (SAIDI) measured in minutes in a year, and the system average interruption frequency index (SAIFI) measured how many times in a year a power interruption occurs. The lower the index, the better, the more stable the power supply is.

 

I took two metrics, scheduled maintenance and power supply or grid-related outages like supply deficiency, plant tripping, transmission maintenance, etc. I compare the performance of private distribution utilities (DUs) like Meralco with ECs in the same province or geographical area.

 

For scheduled maintenance in 2023, Meralco’s SAIDI was 51 minutes while Batangas EC (BATELEC) 1 was 257 minutes (or 4+ hours) and BATELEC 2 was 1,386 minutes (23 hours). In SAIFI, Meralco’s was 0.3 while BATELEC 2’s was 6.3.

 

For power supply, Meralco’s SAIDI was only 26 minutes while BATELEC 1’s was 2,676 minutes (47 hours or nearly two days) and BATELEC 2’s was 1,819 minutes (30 hours). In SAIFI, Meralco’s was only 1.4 while BATELEC 1’s was 10.7.

 

At these numbers, even assuming true that BATELEC 1 and 2’s prices are cheaper than Meralco, the damage to appliances and food in the ref, the inconvenience of enduring candles and heat, the high cost of running gensets, the cost of businesses shutting down for several hours in a day or a week are much higher.

 

In Cebu, the private DU Visayan Electric Co. (VECO) SAIDI in 2023 for scheduled maintenance was 163 minutes (nearly 3 hours) while Cebu EC 1 (CEBECO 1) was 1,761 minutes (29 hours). In power supply, VECO’s SAIDI was 7.6 minutes while CEBECO’s was 311 hours (5 hours). And VECO’s SAIFI was 0.5 while CEBECO’s was 4.4.

 

NEA is a costly bureaucracy. In 2020, it received P12.87 billion subsidy, most of it given to wasteful or losing ECs. That year, the mother agency Department of Energy (DoE) received only P1.32 billion, ERC received P0.58 billion. In 2024, NEA received P3.02 billion while DOE got P2.61 billion and ERC got P0.91 billion.

 

NEA should go and spare the taxpayers of continued subsidy yearly. All ECs should become corporations, monitored by SEC and not NEA.

 

Meanwhile, I will attend the AmCham 8th Annual Energy Forum today at Marriott Hotel, Newport Pasay City. The theme is comprehensive, “Navigating Conventional, Renewable, and Emerging Technologies and Developments in Achieving Energy Security” and among the speakers are Energy Secretary Sharon Garin, Sen. Sherwin Gatchalian and Rep. Mark Cojuangco.

BWorld 813, Declining inflation and challenges for the economic team

Declining inflation and challenges for the economic team

August 7, 2025 | 12:02 am

My Cup Of Liberty

By Bienvenido S. Oplas, Jr.

https://www.bworldonline.com/opinion/2025/08/07/689919/declining-inflation-and-challenges-for-the-economic-team/

 

This week saw a number of good reports in public finance and price stabilization published in BusinessWorld: “Government rightsizing bill signed into law” (Aug. 5), “DBM reluctant to reenact ‘most corrupt’ 2025 budget” (Aug. 5), “Philippine wholesale price growth eases to 3% in June” (Aug. 5), “Stocks go up as inflation cools to near 6-year low” (Aug. 5), “Inflation cools further in July to 0.9%” (Aug. 6), “Bank lending jumps to four-month high in June” (Aug. 6).

 

The “Government Optimization Act,” RA 12231, formerly called the National Government Rightsizing Program, is a long-overdue piece of legislation because the expenditure side of the budget remains the bigger problem than the revenue side, which is why our annual budget deficit and public borrowings remain high — at least P1.5 trillion a year. There is unnecessary redundancy in the bureaucracy that contributes to ever-rising public spending.

 

Congress and the President should have opted for a large reduction in National Government personnel as programs and personnel in local governments keep expanding too. But the President opted for optimizing the services of those who are already hired. Which should imply that new hires should be kept to a minimum.

 

Perhaps the biggest positive economic news this year, so far, is the low inflation rate of only 0.9% for July 2025, just a notch higher than the 0.8% in October 2019 and the 0.7% in April 2016.

 

We went from having the highest inflation rate in East Asia in 2023 at 6%, to 3.2% in 2024, and now it is on the way to possibly 1.8% this year. In contrast, countries in North and South America and Europe have had inflation rates above 2% this year (see table).

 

Accompanying the State of the Nation Address (SONA) by President Ferdinand R. Marcos, Jr. last week, the Department of Finance (DoF) released a statement enumerating some economics positives achieved by the administration. It said that, 1. the Philippines is among the fastest-growing economies in Asia; 2. labor force participation is at an all-time high; 3. prices remain stable, especially for low-income households; 4. the Philippines has achieved the highest revenue effort in 27 years, on track with fiscal consolidation; 5. the deficit and debt remain at manageable and sustainable levels; 6. concessional, strategic, and transparent financing for the Build Better More Program; 7. the Philippines sustained high credit ratings, proof of strong investor confidence; and, 8. laws were passed to boost investments, create jobs, and generate revenues.

 

I concur with the DoF assessment, but I will add that the national spending side needs more control because we need to create a fiscal buffer in case of another economic and health calamity which will require another round of high borrowings.

 

So far, the economic team is gaining headway to build momentum for the next three years, the second half of the Marcos Jr. administration. New challenges for them, I believe, are the following:

 

Finance Secretary Ralph G. Recto has to produce more revenue from the Bureau of Customs, from the mandatory remittances of government corporations, and from the privatization of government assets and enterprises. The CBK hydro plant privatization proceeds would be a good start next year.

 

Budget Secretary Amenah F. Pangandaman has to operationalize the Government Optimization law and Open Government Partnership (OGP) to have a leaner bureaucracy and more transparent budgeting and monitoring.

 

Economics Secretary Arsenio M. Balisacan has to work closely with the infrastructure team so that economic planning and public spending can deliver more tangible and physical results, not just social services that tend to go on forever and lead to more state-dependence instead of self-reliance by the people.

PhilStar 53, Coal power plants and inflation control

Coal power plants and inflation control

ENERGY, INFRA AND ECONOMICS - Bienvenido Oplas Jr. - The Philippine Star 

August 7, 2025 | 12:00am

https://www.philstar.com/business/2025/08/07/2463585/coal-power-plants-and-inflation-control

 

Last week, there was one irresponsible report that came out saying that Department of Energy (DOE) Secretary Sharon Garin has overridden the Department of Environment and Natural Resources (DENR) by granting an exemption on new coal plants to a Meralco Power Gen (MGen) project, the Atimonan One Energy (A1E).

 

This is fake news for two reasons. One, DENR has nothing to do with issuance of permits or moratorium to power plants, DENR only issues environmental clearance certificate (ECC) to proposed energy projects, among others.  Two, A1E is not a new or “greenfield” coal project, it is an old project that has ECC from DENR several years ago.

 

I saw the MGen statement on this, short and direct. They said that “Secretary Sharon Garin has reaffirmed the A1E project’s status as a committed project, consistent with the DOE’s earlier position that the project is not covered by the 2020 Coal Moratorium Policy. We assure our stakeholders and partners that the A1E project remains fully compliant with all applicable environmental laws, rules, and regulations. Aligned with the country’s efforts to ensure energy security and affordability.”

 

Reports like the above are part of the continuing anti-coal campaign and climate alarmism drama worldwide, including the Philippines.

 

In 2024, our coal power generation was only 79.4 terawatt-hours (TWH). In contrast, coal generation of other countries were much larger: 98 TWH by Malaysia, 113 TWH by Taiwan, 127 TWH by Australia, 153 TWH by Vietnam, 188 TWH by S. Korea, 228 TWH by Indonesia, 301 TWH by Japan, 712 TWH by the US, 1,518 TWH by India and 5,828 TWH by China.

 

Or our coal generation full year in 2024 was equivalent to only five days coal generation of China, about four months of Japan’s and nearly half-year of Vietnam’s.

 

Countries that experienced fast average growth of at least four percent yearly over the last decade, 2014-2024, are those that have high coal expansion of 4-162 TWH per year: Philippines, Malaysia, Vietnam, Indonesia, India and China. We need to this energy and growth momentum to keep creating more jobs for our people.

 

Yesterday, I attended the media briefing by the Independent Electricity Market Operator of the Philippines (IEMOP). I checked the energy mix for July 2025 billing and compared it with first quarter (Q1) January-March and Q2 April-June 2025 average energy mix.

 

The share of coal to total power generation has fluctuated from 55 percent in Q1 to 59 percent in Q2 and 54 percent in July. The share of gas has increased from 17.7 percent in both Q1 and Q2 to 21 percent in July. The share of geothermal is generally flat at 8.4 percent, hydro also fluctuated from 10 percent in Q1 to 7.6 percent in Q2 and 10.5 percent in July.

 

The share of intermittent wind + solar combined declined from 5.8 percent in Q1 to 4.9 percent in Q2 and four percent in July. Pumped hydro and battery share is flat at 1.2 percent.

 

This is despite the fact that coal is only 41 percent of total installed capacity, solar at 9.6 percent  and wind at two percent of total capacity, data as of end-July 2025.

 

Last Tuesday, the Philippine Statistics Authority released the July 2025 inflation data, only 0.9 percent and nearly a six-year low. Coal providing 54 percent and gas giving another 21 percent, both account for 75 percent of total power generation and prices at the Wholesale Electricity Spot Market (WESM) remained low at P4/Kwh from May-June-July period. Which contributed to declining inflation of 0.9 to 1.4 percent over those three months.

 

We need more conventional energy sources like coal to stabilize power supply, continue energizing our rising industry/manufacturing and services sectors, and keep overall consumer prices stable.

 

Visayas grid has experienced “yellow alert” from Friday to Tuesday this week except last weekend, usually at 6-8 p.m. where electricity demand is high, lights are on in houses, shops and streets while solar output is zero on those hours. Again, solar that constitutes nearly 10 percent of our total installed capacity is producing zero at night and little during cloudy-rainy days like the two-week habagat just a week ago.

 

MGen has small expansion plan for their coal plants in Iloilo and Cebu while Aboitiz Power also has coal expansion plan in their Cebu plant. These are all “brownfield” projects, meaning expansion of existing coal plants with valid ECC from DENR. Those additional  capacity should come online fast, help save the Visayas grid especially the Cebu, Negros and Panay islands and sub-grids from the threat of blackout.

 

The economic team keeps inviting foreign investments, encouraging existing ones to expand. But if those investors see that the yellow alert, even red alert keep coming every year, a number of them will not come or expand. Energy limitation has become economic limitation. Energy policies translate to economic and investment policies.

BWorld 812, The heroic role of gas plants in cheaper electricity

The heroic role of gas plants in cheaper electricity

August 5, 2025 | 12:02 am

My Cup Of Liberty

By Bienvenido S. Oplas, Jr.

https://www.bworldonline.com/opinion/2025/08/05/689367/the-heroic-role-of-gas-plants-in-cheaper-electricity/

 

A number of non-truthful statements against gas plants especially liquefied natural gas (LNG) came out recently. These include that: a.) gas plants are responsible for recent higher Meralco electricity prices; and, b.) gas plant costs are driving up electricity prices globally and cause more hardship to households.

 

I said “non-truthful” because there are numbers and facts that disprove the above narratives. I compared the electricity rates from July 2022 — the start of President Ferdinand R. Marcos, Jr.’s administration — to July 2025, the last billing period. Here we go.

 

Meralco’s total electricity rates collected increased from P9.75 per kilowatt-hour (kWh) in July 2022 to P12.64/kWh. This increase was due mainly to: a.) a lower distribution refund rate, and, b.) a higher generation charge from pass-through of higher Malampaya prices and the Energy Regulatory Commission (ERC) denial or inaction on requests to adjust charges due to Change in Circumstance (CIC) claims.

 

The LNG plants in Batangas — jointly owned by Aboitiz Power (AP), Meralco Power Gen (MGEN) and San Miguel Global Power (SMGP), the Excellent Energy Resources, Inc. (EERI) and South Premier Power Corp. (SPPC or the Ilijan plant) — have nothing to do with the higher prices this year. And there was even a decline in the Meralco distribution charge from 2022 to 2025 by nearly 4 centavos/ kWh (see Table 1).

 

Here are the numbers for the two reasons for the increase that I mentioned.

 

On (a.): in July 2022, Meralco residential customers got a refund of P1.80/kWh in the distribution charge due to distribution rate true-up. The total refund of P48.2 billion was completed in May 2023. In July 2025, the distribution refund rate covering the latest true-up was lowered by the ERC to P0.205/kWh. So there was an “increase” of P1.596/kWh in distribution adjustments which constitutes 55% of the P2.89/kWh increase over three years.

 

On (b): the generation costs of First Gas Sta. Rita and First Gas San Lorenzo, both owned by FirstGen (not affiliated with Meralco), increased by P1.988/kWh and P2.806/kWh, respectively, over the same period. Both power plants account for about 30% of the generation supply.

 

The ERC denial of, or inaction on, requests for price adjustment based on CIC claims forced the power suppliers — SPPC, Sual Power Inc. (SPI), and ACEN — to terminate their fixed price Power Supply Agreements (PSAs) with a total contracted capacity of 1,310 megawatts. Meralco was then forced to enter into emergency PSAs, which were more expensive by about P1.32/kWh than the PSAs that were terminated.

 

I asked Meralco for more data on the PSA between it and EERI. They replied that the generation cost of the EERI gas plant under the PSA with Meralco would have been lower if the ERC had acted on Meralco’s PSA applications filed in 2021. After conducting a competitive selection process (CSP) in 2021, Meralco and its counterparty suppliers (EERI and Masinloc Power) asked for ERC approval of the two resulting PSAs totaling 1,800 MW — but the ERC did not act for two years. So the power suppliers terminated the two PSAs in March 2023 after the lapse of the long-stop date. Meralco then conducted another CSP in 2024, a period of higher inflation (the Philippine inflation rate was 6% in 2023 and 3.2% in 2024). The offered prices of the 2024 winning power suppliers were P2+ per kWh higher than the winners of the 2021 CSP.

 

So the PSAs of the Meralco “sister companies” — EERI and SPPC/Ilijan — with a combined capacity of 2,400 MW, are not the main drivers of the increase in the total rate. Rather, these PSAs helped augment the supply in the grid to avert power supply shortages and bring down the cost of electricity.

 

Blaming gas plants for driving up electricity prices globally and causing more hardship to households is an idea that I find far out. Many countries, both industrialized and industrializing, are using more gas power. From 1985 to 2024, the expansion in gas power generation in terawatt-hours (TWh) among selected countries was as follows: the USA, from 314 TWh to 2,005 TWh; Mexico from 7 TWh to 222 TWh; Canada from 7 TWh to 109 TWh; Iran from 14 TWh to 340 TWh; Egypt from 9 TWh to 193 TWh. In East Asia the increase was as follows: China from 1 TWh to 321 TWh; South Korea from 0.1 TWh (or 100,000 MWh) to 176 TWh; and, Malaysia from 2 TWh to 74 TWh. Globally it increased from 1,426 TWh to 7,001 TWh.

 

The share of gas to total power generation for many countries has been rising. Looking at the numbers from 1985 to 2024, the USA’s gas share rose from 12% to 43%, Mexico’s from 7.5% to 62%, the UK’s from 1% to 30%, South Korea’s from 0.1% to 28%, and Taiwan’s from zero to 42%. There has been  a significant expansion in GDP size of many countries as they used more hydrocarbons like gas to produce electricity over the past four decades (see Table 2).

 

The Philippines’ gas generation of only 18 TWh in 2024 was equivalent to only seven weeks of gas generation in Thailand, five weeks in South Korea, three weeks in Japan and China, and only three days in the US. It is so small and yet some climate-obsessed activists want to discontinue the expansion of our gas power capacity.

 

The Philippines should have expanded its gas power generation by four times (4X) to be at the level of Malaysia, or 7.6 times to be at the level of Thailand in 2024. The climate activists should turn their anti-gas noise and drama on the USA, Russia, Iran, Saudi Arabia, China, Japan, and Korea. It is very likely that these countries will laugh at these activists.

 

I hope that AP, MGEN, and SMGP will continue their LNG partnership and further expand the Philippines’ gas capacity. More power from stable, dependable sources means there is less threat of blackouts and lower prices of electricity.