THE current energy shortage has already forced some manufacturing plants in Northern Mindanao to cut production by as much as 50 percent, effectively threatening thousands of jobs in the process.
Jerome Soldevilla, president of the Cagayan de Oro Chamber of Industries (Coci), described the region’s power situation as “bleak”.
Industries, he said, may continue operating normally but at a much higher cost.
“The power shortage is harming the industries, threatening to negate a positive outlook of economic rebound that it has portrayed for 2010,” said Soldevilla in an emailed statement to media outlets Thursday.
Coci, a group of manufacturers and giant conglomerates representing the majority of heavy industries in the region, has a combined peak power demand of about 91 megawatts (MW).
Embedded generating capacity, however, is only 36 MW as of the latest figure, said Soldevilla.
He cited the case of Mindanao Silicon Metals, which has to shut down two of its three furnaces as power supply was curtailed by as much as 70 percent.
“If the power situation gets worse in the coming days, it has to shutdown totally its operations. This means losing about 45 tons/day of silicon metals production output and 300 jobs,” he said.
Another company that has slowed down production is Del Monte, while Pilipinas Kao, Asia Brewery and Limketkai Manufacturing including the Limketkai Mall still continue to operate at a desired capacity, but at a much higher cost.
“Operating embedded generators would mean increasing combined cost of production by about P27 million per month,” the Coci president noted.
To mitigate power shortage, Coci lays down the following short term recommendations:
* For government to provide safety nets in order to cushion the impact of higher power costs arising from operating embedded generators.
* Review the ancillary service fees charged by distribution and transmission companies.
* Consider giving incentives to industries doing voluntary shedding.
* PGMA to use whatever available powers she have to address the situation.
* Deploy additional power barges to Mindanao to stabilize power supply situation.
Coci members are the following: Asia Brewery, Catimco Group of Companies, Coca-Cola Bottlers Philippines Inc., Del Monte Phils., Limketkai Manufacturing, Nestle Philippines, Phil Agro Industrial Corporation, Pilipinas Kao Inc., Phil Sinter Corporation, PICMW, RI Chemicals Inc., Mindanao Silicon Metals, Elegant Chemical Alloy and STEAG State Power Inc.
Earlier, Coci joined the Cagayan de Oro Chamber of Commerce and Industry (Oro Chamber) and Industries Association (PIE-MO) in calling for the government to address the power supply problem in Mindanao. In a joint resolution which was presented to Energy Secretary Angelo Reyes during the Feb. 18 stakeholders meeting in Davao City by Oro, the local business groups urged the government to act on the pending generation and transmission related problems in the Mindanao grid.
The local business groups were happy to note that the NPC acted on the Chamber’s request for the Iligan Diesel power plant to resume its operations.
Still on power issue, the Oro Chamber will be presenting its paper on the non privatization of the Agus and Pulangi hydro electric power plants to the Regional Development Council in Northern Mindanao on March 11 for possible endorsement. (TDCB/DVA/Press Release)