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Thursday, August 18, 2005
Arroyo plans fuel rationing
MANILA -- Gasoline rationing is among the drastic measures the government may take under a law that President Gloria Macapagal Arroyo will ask Congress to pass, giving her emergency powers to deal with the worsening oil crisis.
Energy Secretary Raphael Lotilla said Wednesday the law would also give the government the authority to stagger working hours in commercial and industrial establishments and to fix the number of working hours per week.
The proposed law, which would be in force for a limited period, would also allow the government to regulate the use of motor vehicles nationwide to conserve fuel and relieve traffic congestion.
"The proposal is expected to be forwarded to Congress within the next few days," Lotilla said.
Last year, the government discounted the possibility of oil rationing even when prices hit record highs. Instead, oil companies were asked to raise their inventory levels. To date, the country has 66 days of oil inventory.
Serious threat
National Security Adviser Norberto Gonzales said the abnormally high cost of imported oil at $67 per barrel can be considered a "serious national security threat" that calls for an extraordinary response on the part of the government.
At present, Lotilla said the government consumes 126 million barrels of oil a year at a cost of $4.57 billion. He said the country has to shell out $1.26 billion more for every $10 increase in the world price for crude oil.
"If we do not conserve energy, we will reach a point where the rising cost of oil importation will threaten the country's foreign exchange reserves," Lotilla told a press briefing in Malacañang.
Lotilla said the intensified program for alternative energy sources has brought down the share of imported oil in the country's total energy requirements to about 38 percent.
For example, he said, the state-owned National Power Corp. has reduced its dependence on oil-based power generating plants from 15 percent to 11 percent during the rainy season by relying on hydroelectric, coal and geothermal plants.
This will mean savings of P5.6 billion this year.
Emergency powers
Lotilla said the administration's economic managers are strongly recommending the use of emergency powers for a limited period in the wake of rising oil prices worldwide.
The law, he said, could be patterned after Batas Pambansa 73, which was passed by the now-defunct Batasan Pambansa to deal with the oil crisis triggered by the Gulf War in 1980. BP 73 took effect from 1980 to 1985, but was extended by Congress to 1990.
At present, stringent energy conservation measures are being enforced only in government agencies, which have been required to reduce their monthly power and fuel consumption by 10 percent.
The passage of the emergency powers act extend these measures to the private sector.
Finance Secretary Margarito Teves said that while petroleum products will be slapped a 10 percent value added tax under the Expanded VAT Law, the government plans to scrap the excise tax on diesel, kerosene and bunker fuel.
Teves said that as soon as the Supreme Court lifts the temporary restraining order on the EVAT Law, the government will implement Executive Order 440 reducing the import tariff on petroleum products from 5 percent to 3 percent, except for liquefied petroleum gas, which will still enjoy a zero rate.
Indigenous fuels
For his part, Economic Planning Secretary Augusto Santos said that if oil remained at $60 to $70 per barrel, the country's gross domestic product this year would slow to about 5.1 percent from the original forecast of 5.3 percent.
Inflation, in turn, would rise from the original forecast of 7.9 percent to 8.1 percent, Santos said.
Last week, the President ordered stringent energy conservation measures and the aggressive implementation of the alternative fuels program.
The energy department is developing and promoting the use of indigenous fuels such as coco-biodiesel, ethanol and natural gas.
The finance department, meanwhile, is considering increasing the import tariff on vehicles with higher engine displacement to discourage high gas consumption.
The government is also studying the strict enforcement of an 80 kph limit on expressways and national highways, since this is considered the most fuel-efficient speed. (Manila Standard Today)
(August 18, 2005 issue)
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