The Philippine Independent Power Producers Association Inc. (PIPPA) has thumbed down a legislative proposal that will prioritize the use of Malampaya gas on the electricity generation grind of various gas-fed power plants in the country.

While there is a high level temptation to prioritize indigenous gas over imported liquefied natural gas (LNG), the group conveyed that their fuel utilization must be prudently taken as a business decision depending on what will yield lower cost to the consumers.

PIPPA has anchored its policy rejection on the prescription of Senate Bill 2793, which primarily sets a policy to “promote and hasten the exploration and development of indigenous natural gas resources and facilities, and prioritize the use of indigenous natural gas over imported natural gas to help attain greater energy security.”

That legislative measure effectively champions the priority use of Malampaya gas and other future commercial discoveries – that’s before power producers could opt for imported LNG as an option in generating electricity that they will deliver to off-takers (capacity buyers).

Instead of that policy route, PIPPA stipulated that the proposed law must “allow generators to buy imported LNG if prices of imported LNG is lower than indigenous natural gas.”

Conversely, it noted that “if (the) price of indigenous natural gas is lower, then supply of indigenous natural gas should be accessible to all natural gas plants.”

Additionally, the group of power producers emphasized that the measure must also “allow other aggregators to increase supply options for generation companies (GenCos).”

In line with their stand on the gas bill, PIPPA indicated that GenCos shall likewise be permitted to “optimize their own dispatch regardless of whether natural gas is indigenous or imported LNG.”

And by not favoring a fuel or technology as a singular solution in the electricity generation segment of the restructured power sector, PIPPA stated that the GenCos shall likewise be given the leverage “to compete among themselves without priority.”

Nevertheless, those advocating for the priority use of indigenous gas averred that if local production of such resource will not be given warranted preference, then the country’s quest for energy security will be largely placed in the hands of foreign powers and it will also deny local communities of the economic growths they badly need when the sale of local gas to power producers would not be maximized.