IDEAS home Printed from https://ideas.repec.org/p/agy/dpaper/202302.html
   My bibliography  Save this paper

The cost structure of electricity in the Philippines and other Asian countries: A Comparative Note

Author

Listed:
  • Majah-Leah V. Ravago

    (Department of Economics, Ateneo de Manila University)

Abstract

This paper compares electricity cost structure in the Philippines vis-a-vis other Asian countries. The electricity prices in the Philippines are high by regional standards. From the comparative assessment, there is room for cost reduction from the various segments of the power supply chain in the Philippines. First is the utilization of an optimal mix of fuel sources based on the least-cost rule, where cost takes into account the environmental and health costs. The coal and petroleum excise taxes in the 2017 tax reform were a step in the right direction. As the costs of intermittent renewables, especially solar and storage, continue to fall, they may be increasingly attractive, especially in remote areas that use diesel-powered generators. Improvements in the thermal efficiency of coal-fired power plants could also help decrease the cost of fuel. Transmission and distribution losses in the Philippines are also high by regional standards. An assessment of the national grid code and technical audit may be warranted. Finally, the value-added tax in the Philippines is also high. Consumers in the Philippines are also taxed for systems losses and subsidies. Reevaluation of the tax base is also recommended.

Suggested Citation

  • Majah-Leah V. Ravago, 2023. "The cost structure of electricity in the Philippines and other Asian countries: A Comparative Note," Department of Economics, Ateneo de Manila University, Working Paper Series 202302, Department of Economics, Ateneo de Manila University.
  • Handle: RePEc:agy:dpaper:202302
    as

    Download full text from publisher

    File URL: https://www.ateneo.edu/sites/default/files/2023-01/AdMU%20WP%202023-02_0.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Bacon,Robert W., 2019. "Learning from Power Sector Reform : The Case of Pakistan," Policy Research Working Paper Series 8842, The World Bank.
    2. Bacon,Robert W., 2019. "Learning from Power Sector Reform : The Case of The Philippines," Policy Research Working Paper Series 8853, The World Bank.
    3. Sarah Lynne S. Daway & Raul V. Fabella, 2015. "Development progeria: the role of institutions and the exchange rate," Philippine Review of Economics, University of the Philippines School of Economics and Philippine Economic Society, vol. 52(2), pages 84-99, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jamil, Nida & Chaudhry, Theresa Thompson & Chaudhry, Azam, 2022. "Trading textiles along the new silk route: The impact on Pakistani firms of gaining market access to China," Journal of Development Economics, Elsevier, vol. 158(C).
    2. Nazir, Lubna & Sharifi, Ayyoob, 2024. "An analysis of barriers to the implementation of smart grid technology in Pakistan," Renewable Energy, Elsevier, vol. 220(C).
    3. Jamil, Muhammad Hamza & Ullah, Kafait & Saleem, Noor & Abbas, Faisal & Khalid, Hassan Abdullah, 2022. "Did the restructuring of the electricity generation sector increase social welfare in Pakistan?," Renewable and Sustainable Energy Reviews, Elsevier, vol. 157(C).
    4. Syed Zagam Abbas & Zulfiqar Ali & Anzar Mahmood & Syed Quosain Haider & Anila Kousar & Sohail Razzaq & Tehzeeb Ul Hassan & Chun-Lien Su, 2022. "Review of Smart Grid and Nascent Energy Policies: Pakistan as a Case Study," Energies, MDPI, vol. 15(19), pages 1-23, September.
    5. Majah-Leah V. Ravago & Arlan Zandro I. Brucal & James Roumasset & Jan Carlo Punongbayan, 2019. "The Role of Electricity Prices in Structural Transformation: Evidence from the Philippines," Working Papers 201904, University of Hawaii at Manoa, Department of Economics.
    6. Ravago, Majah-Leah & Fabella, Raul & Alonzo, Ruperto & Danao, Rolando & Mapa, Dennis, 2016. "Filipino 2040 Energy: Power Security and Competitiveness," MPRA Paper 87721, University Library of Munich, Germany, revised Jan 2018.
    7. Ravago, Majah-Leah V. & Fabella, Raul V. & Jandoc, Karl Robert L. & Frias, Renzi G. & Magadia, J. Kathleen P., 2021. "Gauging the market potential for natural gas among Philippine manufacturing firms," Energy, Elsevier, vol. 237(C).
    8. Sarah Lynne Salvador Daway‐Ducanes, 2019. "Remittances, Dutch Disease, and Manufacturing Growth in Developing Economies," Scottish Journal of Political Economy, Scottish Economic Society, vol. 66(3), pages 360-383, July.
    9. Ravago, Majah-Leah V. & Brucal, Arlan Zandro & Roumasset, James & Punongbayan, Jan Carlo, 2019. "The role of power prices in structural transformation: Evidence from the Philippines," Journal of Asian Economics, Elsevier, vol. 61(C), pages 20-33.
    10. Afia Malik & Idrees Khawaja, 2021. "Urban Resilience and its Impact on Electricity Provision in Karachi, Islamabad and Peshawar," PIDE Monograph Series 2021:1, Pakistan Institute of Development Economics.
    11. Sarah Lynne Salvador Daway‐Ducanes & Maria Socorro Gochoco‐Bautista, 2021. "Aspects of financial development and manufacturing and services growth: Which matter?," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 26(2), pages 2560-2580, April.
    12. Afia Malik, 2020. "Circular Debt—an Unfortunate Misnomer," PIDE-Working Papers 2020:20, Pakistan Institute of Development Economics.
    13. Orbeta, Aniceto Jr. C. & Paqueo, Vicente B., 2016. "Beware of the "End Contractualization!" Battle Cry," Discussion Papers DP 2016-55, Philippine Institute for Development Studies.
    14. Victor S. Venida, 2020. "Updates of Empirical Estimates of Marxian Categories: The Philippines 1961-2012," Department of Economics, Ateneo de Manila University, Working Paper Series 202011, Department of Economics, Ateneo de Manila University.
    15. Paqueo, Vicente B. & Orbeta, Aniceto Jr. C., 2016. "Beware of the "End Contractualization!" Battle Cry," Discussion Papers DP 2015-55, Philippine Institute for Development Studies.
    16. Sarah Lynne S. Daway & Geoffrey M. Ducanes & Raul V. Fabella, 2017. "Quality of Growth and Poverty Incidence in Low Income Countries: The Role of Manufacturing," UP School of Economics Discussion Papers 201708, University of the Philippines School of Economics.
    17. Sarah Lynne Salvador Daway-Ducanes & Maria Socorro Gochoco-Bautista, 2019. "Manufacturing and Services Growth in Developing Economies: ‘Too Little’ Finance?," Progress in Development Studies, , vol. 19(1), pages 55-82, January.

    More about this item

    Keywords

    Electricity; Electricity price; Philippines and Asia; deregulation;
    All these keywords.

    JEL classification:

    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • L4 - Industrial Organization - - Antitrust Issues and Policies

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:agy:dpaper:202302. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Jat Tancangco (email available below). General contact details of provider: https://edirc.repec.org/data/deadmph.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.