Calling for Semirara’s patriotism

By Herbert Vego

IT was just to heat up the coal issue, I hope, that motivated two Iloilo City councilors – lawyers Romel Duron and Sedfrey Cabaluna — to argue over the former’s resolution aimed at reducing the price of coal sold to the local power distribution utility.

In a nutshell, Cabaluna pointed out that it should be “sana all” rather than for their city constituents alone.

All was well that ended “approved”. As the title of the resolution says, it is a “a resolution urging Semirara Mining and Power Corporation (SMPC) to prioritize the supply of coal and power to local generation and distribution companies respectively at reasonable rates in Panay Island.”

Any other legislative bodies elsewhere may follow suit and thus gain stronger sway.

This corner has twice begged of the political stalwarts from Antique – namely Sen. Loren Legarda, Governor Rhodora Cadiao and Rep. AA Legarda — to request Semirara Mining and Power Corporation (SMPC) to cut prices of its coal sold to coal-fired power plants.

The company owns and operated the coal mine in Semirara, an island barangay of Caluya, Antique.

None of the above responded to relay to DMCI-Holdings Inc. – the parent company of SMPC – our call for patriotism.

Electricity prices in the entire country have ballooned, allegedly in proportion to the sudden leap in the price of coal in the world market from US $60 to $400 per metric ton in the wake of the prolonged war between Russia and Ukraine, which are among the major producers of coal. It does not make sense that Semirara would sell to the local market at the same price.

Ironically, it’s the province of Antique that is worst hit by the inflationary response, what with its sole distribution utility (DU), the Antique Electric Cooperative (Anteco) charging the highest power bill in Western Visayas at P16.17 per kilowatt-hour (kWh)?

Iloilo City’s DU, MORE Electric and Power Corporation, was left with no choice but to hike its residential rate from ₱9.14 to ₱12.48 per kilowatt-hour.

Around 60% of the charges in the power bill, incidentally, goes to the cost of coal and power generation.

In his explanatory note to the resolution, Duron said, “As of end of September this year, SMPC’s coal production breached the 13.7 million metric tons mark, a 27% increase compared to the same period last year.  The selling prices of its coal rallied by 122% for the 9-month period while its spot selling price rose by 38%.  In summary, SMPC established a record high profit of ₱36 billion compared to ₱10.3 billion last year for the same period.  It is a giant improvement equivalent to a 250% increase.”

If I remember right, that information was confirmed by SMPC president Maria Cristina Gotianun.

One of Duron’s resolutions stresses that “SMPC can well perform its patriotic duty particularly to citizens of the host Panay Island by tempering the coal and generation rates it sells to local generation and distribution utilities in Panay Island,”

It is interesting to note that Semirara Island is only 218 km or a few ship hours away from Calaca, Batangas – the site of its subsidiary generating utility, the Sem-Calaca Coal-Fired Power Plant. That proximity translates to freight-cost advantage compared.

Certainly, if it sells only 25% of its production to the local market, why should it punish the local market with world-market rates? Certainly, it could afford to stick to old prices in the local market without losing.

You see, SMPC sells the bulk of 75% of its coal to China, South Korea and Vietnam.

This corner appeals to Senator Loren Legarda to do a “repeat performance” of what she did in July 2015 when she called for a Senate probe of the collapse of a Semirara open pit, which resulted in the death of nine miners. She reminded her colleagues that it was a repetition of an earlier landslide in February 2013 which killed five miners.

In both tragedies, SMPC promised to compensate the families of the victims a sum of one million pesos each, plus free education up to college for their children.