Provincial treasurer Danilo Mendez of Negros Oriental has sent a collection letter to the Energy Development Corporation geothermal plant on the payment of the long overdue real property tax account worth P171,643,453.58.

In the letter addressed to EDC president Richard Tantoco, the province warned that it will be forced “to institute obligatory proceedings” if the country’s biggest producer of geothermal energy fails to settle its obligation.

But the EDC said it will bring the issue before the Bureau of Local Government Finance for arbitration, even as the corporation promised to settle P31 million as partial and provisional payment of the real property tax while the issue is still unresolved.

Mendez said that it will be advantageous for the provincial government if the BLGF arbitrates, as this will avoid costly litigation. He said that he is confident that the province will get the entire P171 million tax due.

Should the BLGF rule in favor of EDC’s position as per the certification issued by the Department of Energy last May 12, the date applied for by the company as a renewable energy developer and generating facility, only P31 million can be collected.

Under the Renewable Energy Act of 2010, RE developers enjoy tax exemptions. EDC maintains that only its power plants are subject to real property tax, similar to the one imposed on its subsidiary, the Green Core Geothermal Inc.*RG

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