Abstract:
Luzon accounts for over three-fourths of the national electricity consumption. Although the growth rate in electricity consumption over the past five years has been slightly higher in the Visayas and Mindanao than in Luzon, the Luzon electricity sector impacts will tend to dominate the national impacts for many years.
However, the level of overall national gains indicates that it is both feasible and desirable to design a compensation package for Mindanao. The compensation can take the form of annual payments to Mindanao of about P2.0 billion or a one-time payment or establishment of a trust fund of ab out P13 billion, depending on the assumed discount rate. Since these compensation values are obtained without taking into account the possible production gains to households, then these values can be considered upper bounds for the compensation. The general equilibrium results indicate that Mindanao households may possibly partake in the boom notwithstanding the increases in their electricity prices. Their annual welfare gain, after production gains are realized, can be as much as P1.85 billion, realized in terms of higher incomes and greater employment opportunities.
Info
| Source Institution | Department of Energy |
| Source URL | http://www.doe.gov.ph/doe_files/pdf/Researchers_Downloable_Files/DownloadableFiles/Consumer.pdf |
| Page Count | 103 |
| Place of Publication | Manila |
| Original Publication Date | |
| Tags | Electricity Consumption, Power Sector, Sector Reforms, Welfare Effects |