Hike in coal tax will worsen consumer woes, won’t advance clean energy – scientists

January 9, 2018 - 1:36 PM
Semirara Mining's Panian coal pit (PhilStar file)

MANILA, Philippines — Scientists said the increase in the excise tax on coal is not, contrary to the claims of some quarters including government, a major step toward reducing the country’s emission of harmful gasses but, because it is “pass-on,” will be an added burden for power consumers.

“Electricity consumers are at the losing end with the imposition of the coal tax,” said Finesa Cosico, secretary-general of Advocates of Science and Technology for the People, or AGHAM. “They will be burdened with higher electricity rates despite standing to gain no real benefit from the supposed environmental regulation.”

Under the Tax Reform for Acceleration and Inclusion, or TRAIN, law, the tax on coal will increase from the current P10 per metric ton to P50 this year and by P50 per year until 2019.

AGHAM said the Department of Energy describes the coal tax as an excise tax, which is classified as a pass-on charge to consumers under the Electric Power Industry Reform Act or EPIA, the law that liberalized the country’s energy industry.

“As a pass-on charge, the coal tax will put the entire burden of rising power costs on consumers instead of taxing big-time coal businesses. As such, it will not inhibit the increase of coal-fired power plants,” Cosico said.

Because of this, it is unlikely to “change the Duterte government’s framework of using coal as the primary source in the country’s energy mix,” she added.

AGHAM demanded “the reorientation of the coal tax as a charge to be carried by corporations” and for the repeal of EPIRA, “which has allowed the phenomenon of such pass-on provision.”

“We also call for the redistribution of the energy mix away from the pollutive coal to the indigenous energy resources abundant in the country,” Cosico said.