Utilities grow faster on increased demand

OUTPUT growth by the electricity, gas, and water sector hastened in 2016 brought by increased demand for these utilities.

Philippine Statistics Authority data showed that the sector’s gross value added (GVA) increased by 9.8% to P271.22 billion in 2016. This was faster than the 5.7% growth rate recorded in 2015 and was the fastest since 2010, when the sector posted 9.91%.

The electricity subsector saw its GVA rise by 10.44% to P235.61 billion last year and accounted for 86.87% of the sector’s total value.

On the other hand, water companies’ output increased 6.1% to P23.92 billion, while the steam industry’s GVA expanded by 5.4% to P11.69 billion. Water and steam subsectors accounted for 8.8% and 4.3% of the sector’s aggregate output, respectively.

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Data from the Department of Energy (DoE) show total sales going up 9.4% to 74,153 gigawatt-hours (GWh) in 2016. Total electricity consumption also rose by 10.2% to 90,798 GWh. As of July 2016, households with access to electricity stood at 20.36 million, or 89.6% of the total.

In its 2016 Philippine Power Situation Report, DoE attributed the increase in electricity consumption to the rise in temperature made worse by the El Niño, national and local elections held in May, entry of power generating plants, and increase in demand brought by economic growth.

Power demand-supply remained stable in the first three months of 2016 despite the occurrence of El Niño, the Energy department said in its annual report. However, in April and May, yellow and red alerts were declared in Luzon and the Visayas. In Mindanao, hydro capacities declined.

According to the DoE, El Niño Mitigation Measures and preparation for the May elections stabilized the situation. The DoE said some of the measures were: “activation of the Interruptible Load Program, ensuring minimal force outages, management of power plant maintenance schedules and optimization of hydro capacities specifically in Mindanao.”

Manila Electric Co., the country’s largest power distributor, reported a net income of P19.2 billion last year, marginally higher than the P19.1 billion posted in 2015, citing an increase in electricity volume sales and higher financing income. Excluding exceptional items, core net income reached P19.6 billion, higher by 4% compared with P18.9 billion a year earlier due mainly to an 8% increase in electric consumption.

On the other hand, Maynilad Water Services, Inc.’s core profit fell 26% to P7.2 billion from P9.7 billion, while Manila Water Co., Inc. reported a 2% increase in net income in 2016 to P6.07 billion from P5.96 billion a year ago, with the company maintaining growth in its service connections at 3% as it breached the million mark at 1,008,918 last year. — Christine Joyce S. Castañeda