Make economic case for energy efficiency, bill backers told

GOVERNMENT agencies and private sector organizations backing the passage of proposed legislation on energy eff iciency should present hard numbers to justify how its economic impact will offset foregone revenue from the tax incentives offered in the bill.

This is the “contentious issue” that is likely to put the bill under further scrutiny, said Sherwin T. Gatchalian, chairman of the Senate committee on energy, in an interview on the sidelines of a recent hearing.

“We have to see that,” he said, referring to the economic reflow or benefits that could make up for lost revenues. “We have to justify what that reflow is because that’s theoretical.”

“We have to look at the assumptions, the basis of that reflow,” Mr. Gatchalian said, referring to the benefits that will be reaped by the economy.

The hearing reviewed Senate Bill No. 30, “An Act Institutionalizing Energy Eff iciency and Conservation, Enhancing the Efficient Use of Energy, Granting Incentives to Energy Eff iciency and Conservation Projects, and for other Purposes.”

It also matched relevant provisions with the comments and position papers submitted by energy industry stakeholders.

Supporters of the bill, including the Department of Energy (DoE) and private group Philippine Energy Efficiency Alliance, Inc., said the benefits would more than offset the lost revenue from the tax-free importation of energy-eff icent equipment, among others.

“Let’s quantify that because philosophically, it’s good to have fiscal incentives but what will be lost, what will be plowed back,” he said.

“Taking note of what the administration wants to do, which is to harmonize, simplify, standardize fiscal incentives, this (proposed legislation) should be consistent to that philosophy. And definitely, one of the cornerstones of this administration is to fix and reform the tax incentives and the tax regime of our country,” he said. —