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Philippine Tuna Canneries Losing USD 50.000/Day Philippines, April 17, 13

Rotating brownouts lasting up to eight hours daily disrupt business operations here in the tuna capital of Philippines, forcing giant canneries to operate generators that churn up losses to as much as P10 million per cannery a month, business leaders said on Monday.

Rey Billena, Vice-President of the General Santos Chamber of Commerce and Industry, said total daily losses for seven canneries was estimated at P2 million, including lost man-hours.

“The losses amounted to a total of P8 million (USD 20,000) to P10 million (USD 25,000) per cannery per month, and there are seven canning factories here,” Billena said.

General Santos City together with South Cotabato, Cotabato, Sultan Kudarat and Sarangani, known as the SOCSARGEN, have been reeling from severe lack of electricity supply because of low water levels in seven hydroelectric power plants in the region. The water levels are not expected to improve during the summer months.

The government has started building coal-powered plants to augment electricity supply, but they are scheduled to be operational in 2015. A 102 megawatt diesel power plant in Iligan is expected to start operating this month, but it will not be enough to cover the shortages.

Billena, who operates an ice cream factory, said he suffer losses of about P500,000 a month in additional costs, and other businessmen think of closing down temporarily to prevent total bankruptcy.

Philippine Chamber of Commerce and Industry Vice President for Mindanao Ricardo Juliano said the brownouts has worsened from two to three hours a day to eight hours a day and many businesses have been devastated by the outages.

“We are very concerned. If this will not be addressed, it will get worse,” Juliano said.

The Mindanao Development Authority (MinDa) said two coal-powered plants were expected to be operational in 2015: a 105-megawatt plant by Conal Holdings in Maasin in Sarangani and a 300-megawatt plant by the Aboitiz Group in Davao City.

These plants were expected to give Mindanao a comfortable reserve of power in 2015, a MinDa official said.