BUILDING costs that were based on estimates from before the current rise in fuel prices are in danger of spiralling, according to construction companies, which said end-users will eventually need to help them recover the costs. READ:
“Previous projects won were based on old fuel prices… We are now buying at higher prices to feed our trucks, excavators, graders, etc. Moving forward, construction cost will increase,” according to Levi B. Agoncillo, Aboitiz Construction’s vice-president for business generation and technical services.
But fuel costs are expected to climb again this week, according to Energy Undersecretary Gerardo D. Erguiza, citing the increase in the Dubai crude benchmark. An oil company has estimated that diesel prices will rise by P7.95-P8.15 per liter this week while gasoline prices will increase by P2.95-P3.15 per liter.
It added that some of the higher costs will be mitigated by its practice of operating “mobile and on-site batching plants located in major projects.” With such facilities, “the impact is less pronounced compared with other players which do not operate mobile plants.” “Currently, the recovery of demand for construction materials and the persistent global supply chain disruption resulting in port blockages are factors that aggravate the increasing cost of fuel/energy — likely increasing the cost of construction materials in the short- to medium-term,” he said in an e-mail replying to a query fromJoey Roi H.
Megawide said a shift to renewable energy could be a solution to reduce dependence on imported energy sources.
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