Press Statement from the CEMENT MANUFACTURERS’ ASSOCIATION OF THE PHILIPPINES (CeMAP) 14 June 2006

The Cement Manufacturer’s Association of the Philippines expresses grave concern over the sudden suspension of the One Day Power Sale (ODPS) scheme from May 22-27, 2006 and the more recent suspension from June 4-10, 2006.

As stand-alone facilities, cement plants are major power users with demand of around 20-30 MW per location.

We are deeply concerned over the dire consequences of the sudden announcement of the cancellation, and the cancellation itself because:

  1. Power costs account for approximately 30% of total production costs of cement, and the ODPS cancellation contributes to a sharp rise in the cost of our members’ operations;
  2. The sudden nature of these announcements do not give our members enough time to adjust their operations and to prepare to generate their own electricity, thus forcing their plants to draw power from the grid at rates that are 120% higher than their former cost.

We appeal to leaders of the Energy and the Power Sector to decisively reduce the cement industry’s vulnerabilities, and call on a shared effort to find solutions that will:

  1. Provide ODPS customers with enough lead time and prior information regarding these cancellations;
  2. Provide ODPS customers with an alternative pricing mechanism to minimize the impact of such a sharp rise in purchased power cost; and
  3. Fast-track the liberalization of the power sector by allowing industrial users greater choice in the sources of their power.

We count on the earnest desire of the leaders of the Energy and Power Sector to provide a progressive and lasting solution to this predicament, and work towards a win-win solution for the best of our country.


Ernesto M. Ordoñez
President
Cement Manufacturers’ Association of the Philippines

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