The power distribution utility, headed by tycoon Enrique Razon Jr., has significantly contributed to the economic development of Iloilo, an economist claimed.

At the Iloilo Business Summit on Thursday, Oct. 19, Winston Conrad Padojinog, Unviersity of Asia and the Pacific economist highlighted MORE Electric and Power Corp.'s (MORE Power) achievements in improving the local power infrastructure.

In particular, Padojinog said the company has successfully reduced the frequency and duration of power interruptions, ensuring a more reliable power supply for both businesses and households in the area.

MORE Power’s governance measures have also lowered system losses that follows with the Energy Regulatory Commission’s (ERC) charges cap.

The company’s strategic operations in the energy industry was also highlighted and showcased by Padojinog.

He shared his comprehensive study on MORE Power in view of the city’s economic potential and what approaches can be made in order to further develop Iloilo.

The key economic impacts include MORE Power’s improved operational revenues.

Firstly, the customer base garnered approximately P4.99 billion to Iloilo’s Gross City Domestic Product (GCDP). This amount contributed 3.8 percent of the local economy.

Following this, MORE Power has also created 6,693 indirect and direct jobs from the year 2020 to 2022.

Because of this, P1.75 billion worth of additional household income has been made in the span of two years.

Padojinog then presented the benefit of reduced system losses.

System losses are essentially wasted energy due to external or internal energy factors.

Weather or atmospheric conditions, theft, miscalculations are some of the common examples of system losses.

Because the losses were decreased, energy consumers no longer have to pay more, thus allowing them to have an extra income.

This garnered P1.01 million worth of consumption spending in 2022.

“You could see [this as] the household multiplier impact,” Padojinog said. “[the household income] is growing as the output coming from MORE Power also increase.”

Furthermore, Iloilo’s gross domestic product (GDP) reduced 2.4 percent of its decline during the 2021 pandemic.

This meant that the city’s economy was able to bounce back to its growth trajectory by 2022.

With MORE Power’s strategies that boosted Iloilo’s economy, there are a few takeaways that can be considered, according to Padojinog’s study.

One is to attract and retain investors. He stated that investors, especially foreign ones, play a vital role in the economy.

“Their [investors] decision, they decide by the level of profitability that they generate,” he said. 

Another is to invest and improve infrastructures, like having a reliable utility provider. 

Padojinog explained, “If you have an unreliable service provider, it will lead to rent-seeking behavior,”

Finally, when attracting great investments, the economist stressed the importance of policy stability. This allows investors to run the numbers and ensures returns.

He also emphasized that 60 percent of the country’s GDP is debt, and will be needing stable policies and foreign direct investments to aid with this.

“The Public Service Act is very important. [This] allows 100 percent foreign ownership of utilities,” he said. “We need fresh capital into our economy, and we need those foreign investments.” (Gabriell Christel Galang)