The Philippines’ Power Sector Assets and Liabilities Management Corp (PSALM) has rejected an appeal to extend the lower electricity rates offered to ecozone locators.

The special rate currently granted to ecozones is due to lapse on December 25and the Manila Electric Company (Meralco), Philippine Economic Zone Authority and members of the Semiconductor and Electronics Industries of the Philippines have appealed for an extension.

PSALM president Emmanuel Ledesma said: “Although we fully understand the possible implications of this decision to the economy, it is no longer reasonable for us to renew this power supply contract with Meralco.”

The special rate for ecozones was designed to help power-intensive businesses deal with the high cost of operations. Meralco claims that without the special rates, it will find it very difficult to secure contracts, and that the high power rates will dissuade investors.