ERC ignored impact of power rate hike–SMC unit By Lenie Lectura @llectura
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HE Energy Regulatory Commission (ERC) “chose to look the other way” when it ruled against the petition for a temporary relief to recover part of the P15 billion in losses incurred by the units of SMC Global Power Holdings Corp. (SMCGP), the power arm of conglomerate San Miguel Corp. (SMC) said Monday. “ERC was made aware of the looming power rate hikes. It was also made aware of how it can ensure that the public gets the lowest possible rate while energy players continue to supply power viably amid rising geopolitical risks beyond anybody’s
control. Yet, it still chose to look the other way,” said SMCGP. The company’s statement was issued a day after President Ferdinand R. Marcos Jr. said he was hoping that the Court of Appeals (CA) would reconsider the “unfortunate” ruling of its 14th Division regarding a 60-day temporary restraining order (TRO) in favor of South Premier Power Corporation (SPPC). The TRO, in effect, suspended the implementation of SPPC’s power supply agreement (PSA) with Manila Electric Company (Meralco). Consumer advocacy group Infrawatch commented, however, that the President “should allow full judicial proceedings to take its course,” and that “his views may
ably be represented through ERC lawyers and the Solicitor General.” The ERC’s September 29 order denied the rate hike joint petitions of SPPC, San Miguel Corporation (SMEC), and Meralco for price adjustments to serve as temporary relief covering a combined P5.2billion losses incurred from January to May 2022 due to the unprecedented spike in fuel prices. According to the ERC, their plea for price increase was denied because the agreed price in the PSA is fixed in nature, and the grounds for increase cited by SPPC and Meralco were not among the exceptions that would allow for price adjustment. Chairperson Monalisa Dimalanta expressed grave concern on
the impact of the TRO, saying this will expose approximately 7.5 million Meralco customers to higher electricity prices.
‘Least costly option’
HOWEVER, SMCGP said ERC “knowingly exposed public to much higher power rates.” “In our joint petition before the ERC, Meralco already provided the Commission with in-depth computations and projections showing that granting the temporary rate hike would have been the least costly option for power consumers. It would also be beneficial in the long term, as it would preserve the fixed-rate PSAs,” SMCGP said. See “ERC,” A2
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Tuesday, November 29, 2022 Vol. 18 No. 48
P25.00 nationwide | 2 sections 30 pages |
BIR TAX ROW WITH DOE T
By Joel R. San Juan
@jrsanjuan1573
₧300 a kilo onion price prompts DA monitoring
HE Supreme Court has declared that it is the Secretary of Justice or the Solicitor General who has the authority to settle the dispute between the Department of Energy (DOE) and the Bureau of Internal Revenue (BIR) over the latter’s demand for payment of deficiency excise taxes of P18.37 billion.
In an 18-page decision penned by Associate Justice Maria Filomena D. Singh, the SC’s Third Division junked the petition for review filed by the DOE seeking the reversal of the November 4, 2021 decision issued by the Court of Tax Appeals (CTA), denying its plea to set aside the warrants of distraint and/or levy and garnishment issued by the BIR on September 19, 2019. The CTA held that it has no jurisdiction over the case since it is a purely intra-governmental dispute. The DOE then elevated the issue before the Supreme Court, asserting that the CTA erred in dismissing
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its petition on the ground of lack of jurisdiction. The DOE insisted that CTA has jurisdiction over the case as Republic Act 1125 (An Act Creating the Court of Tax Appeals) prevails over Presidential Decree No. 242 Prescribing the Procedure for Administrative Settlement or Adjudication of Disputes, Claims and Controversies Between or A mong Gover nment Of f ices, Agencies and Instrumentalities, Including Government-Owned and -Controlled Corporations, and for Other Purposes. See “SC,” A2
‘CHINA’S FRESH COVID CRISIS COULD IMPERIL PHL RECOVERY’ By Cai U. Ordinario @caiordinario
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ITH China reporting nearly 40,000 cases a day, some local economists are concerned that this could again lead to trade disruptions and imperil Philippine economic recovery. Former University of the Philippines School of Economics (UPSE) Dean Ramon L. Clarete told the BusinessMirror on Monday that with the possible impact on the country’s growth, the government should be more hell bent in diversifying the country’s trade partners. Wire agency reports over the weekend said 25 million people were on lockdown in Shanghai in April and May, while shops and cafes were also mandated to close to prevent the spread of Covid-19. The “zero Covid” strategy of the Chinese government has also prompted large protests across the country. “It [China] will slow us down.
But on the other hand, it is time to diversify our value chain partners. The autocracy of Xi [Jinping] cannot be compatible with sustained growth. China is going down,” Clarete told this newspaper. Former Tariff Commissioner George B. Manzano also told the BusinessMirror the disruptions in China will affect global supply chains. More lockdowns, Manzano said, will affect the demand side of the country’s exports and supply side of Philippine imports. “PH exports to China have sizable inputs coming from China. It is a bit dated, but in 2017 close to 15 percent of the import content of Philippine exports to China, comes from China itself,” Manzano noted. The former dean of the UP School of Labor and Industrial Relations, Rene Ofreneo, agreed with Clarete and Manzano that whatever is happening in China now will reach the Philippines through trade. Continued on A5
PESO EXCHANGE RATES n US 56.7530
RARE ROLLBACK A gas attendant is seen at a station on Monday. Oil firms announced Monday that diesel prices will be reduced by P3.95 per
HE Department of Agriculture (DA) on Monday said it is closely monitoring the supply of red onions as the prices went up as much as P300 per kilo. Based on their monitoring, Agriculture Assistant Secretary Kristine Evangelista said red onions were sold at around P280 to P300 per kilogram. “In our monitoring, we noticed a spike in the price of red onion. There are P280 and we even found P300 a kilo. So now, we are asking the Bureau of Plant Industry to see the supply situation so we can know what is the reason for the price spike,” said Evangelista at the Laging Handa public briefing. “We are waiting for the inventories from the Bureau of Plant Industry from cold storage facilities... But while we are doing that, the public can avail [themselves of] onions at P170 at our Kadiwa stores,” she added. Evangelista said the government has yet to consider importing red onions because of the expected harvest in December. “They [farmers] said they have a harvest in December. We will look at the volume because that will help increase supply,” she said. “Within the week, we will have an inventory situation … That will definitely help our supply situation,” she said.
liter, effective Tuesday morning. The price of kerosene and gasoline will also go down by P2.65 per liter and P0.85 per liter, respectively. Most oil firms announced the price rollback to take effect at 6 a.m. on November 29. Story in Economy, page A4. ROY DOMINGO
See “Onion,” A2
IT-BPM seen to reap $32-B revenue By Andrea E. San Juan
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HE IT and Business Process Association of the Philippines (IBPAP) said the IT and Business Process Management (IT-BPM) industry is expected to contribute nearly $32 billion worth of revenue to the Philippine economy in 2022, a sum that it said will surpass the industry’s 8-percent contribution to the country’s gross domestic product (GDP). IBPAP President Jack Madrid revealed on Monday that the ITBPM industry will end the year on a high note with the robust revenue contribution. The industry expects to end the year employing 1.56 million Filipinos. “I am happy to say that we
remain very much on the same trajectory as 2021. We expect to end the year with a total of 1.56 million Filipino employees which really bodes well for 2023 and beyond; happy to also say that our revenue contribution to the Philippine economy is probably going to be in the vicinity of $32 billion USD, well on track to surpassing our 8 percent contribution to the country’s GDP,” Madrid said in a televised interview on Monday. While the industry’s figures indicate continuous growth, Madrid said the IT-BPM industry is not spared from challenges that need to be dealt with such as the availability of “employable talent.” Continued on A5
n JAPAN 0.4077 n UK 68.5292 n HK 7.2639 n CHINA 7.9225 n SINGAPORE 41.1910 n AUSTRALIA 38.1323 n EU 58.9664 n KOREA 0.0425 n SAUDI ARABIA 15.1039
Source: BSP (November 28, 2022)