ECCP pushing tax perks to boost energy-efficient programs

Business World Online

Posted on June 22, 2012 06:15:09 PM

TAX PERKS should be considered to encourage firms to implement energy efficiency programs, said the European Chamber of Commerce of the Philippines (ECCP) on Friday.

“We hope to enlighten the government to use carrots to attract firms to invest in energy efficiency. Tax incentives may be effective for this purpose,” said Henry Schumacher, ECCP vice-president for external affairs, in a media briefing in Makati City.

As a step towards the advocacy, the ECCP last month signed a memorandum of agreement with the Philippine Economic Zone Authority (PEZA) that called on European locators to implement energy efficiency schemes in preparation for the expiration of discounted power rates in economic zones in Luzon.

The Ecozone Rate Program should have ended in December 2011 but has been extended to three months after the implementation of an Open Access Retail Competition regime, which will allow consumers using at least one megawatt of electricity to directly source their power from producers.

“Some PEZA locators are worried about possible higher cost of electricity [under open access] but this can be averted if the companies now enjoying subsidies will invest in energy efficiency,” Mr. Schumacher said.

Energy Secretary Jose Rene D. Almendras in March said the government is looking to launch the new power scheme in October.

Recommendations for tax perks may be discussed during the ECCP’s third Philippine Energy Efficiency Forum (PEEF) on July 10 at the SMX Convention Center in Pasay City and on July 17 at the Radisson Hotel in Cebu City, said Mr. Schumacher.

In the same event, ECCP President Hubert d’Aboville noted that the PEEF 2012, with the theme “Driving Efficiency and Competitiveness Across the Power Sector Value Chain,” will highlight initiatives to increase energy efficiency in power production, transmission and distribution as well as in industrial, commercial and residential end-use.

“[E]fficiency improvements from power plant to plug have the potential for big savings in total power use and large reductions in greenhouse gas emissions,” Mr. d’Aboville said.

“Reductions in total energy costs often provide positive returns on investments for the whole country,” he added.

For his part, Noel Verdote, operations officer for the Philippine Sustainable Energy Finance project of the International Finance Corp., the ECCP’s partner for PEEF 2012, underlined the difference between energy efficiency and energy conservation.

“If you cut down your operating hours in order to reduce power cost, you are not moving toward energy efficiency. Efficiency means doing better with less amount of work,” Mr. Verdote said.

“To become more competitive, firms in the Philippines should strive to increase their output while using less energy,” he added. -- Kim Arveen M. Patria    source