QUEZON CITY – The
National Grid Corporation of the Philippines (NGCP) has reiterated its position
that acquiring assets that are performing transmission functions, but are
currently under the control of other entities, will be beneficial to electric
power consumers in the long run.
Some groups
have opposed NGCP’s planned acquisition, saying that the purchase will be a
violation of the Electric Power Industry Reform Act (EPIRA) or RA 9136.
On the
contrary, NGCP said that it has the legal basis to acquire at fair market price
the said assets. NGCP – the power transmission service provider and grid
operator – made the clarification as it looks to acquire power facilities
classified as transmission assets in a move to better manage and uphold the
security and integrity of the nationwide power grid.
Among PEDC’s
transmission assets are a switchyard, transformers, power circuit breakers,
transmission line, SCADA and microwave system, and the lot where the switchyard
is constructed.
“While Section 9 of the EPIRA allows a generator
to own, operate and maintain a dedicated point-to-point limited transmission
facility, this is only on the condition that said facility is solely used by
the generator to connect to the grid and that it will not be used to connect
other users. Distribution utilities and/or other generators and large customers
are not allowed to connect to the facility,” said Atty. Cynthia P. Alabanza,
NGCP Spokesperson and Adviser for External Affairs.
Section 21 of
the EPIRA mandates that NGCP, as TransCo’s concessionaire, is the entity solely
responsible for the improvement, expansion, operation, and/or maintenance of
the nation’s transmission assets. It is the only entity which possesses the
required technical expertise to maintain and operate the nationwide power grid.
“No other entity is legally authorized to operate transmission assets, and NGCP
is the only company technically competent to do so,” stressed Alabanza.
NGCP had
earlier filed an application with the Energy Regulatory Commission (ERC) to
seek approval of its capital expenditure for the acquisition of power
facilities classified as transmission assets, including those under the control
of Panay Energy Development Corporation’s (PEDC). PEDC, a generation company,
is connected and currently supplying power to the grid through NGCP’s Sta.
Barbara Substation.
“In the case of the PEDC assets subject of NGCP’s
application with the ERC, the assets are not only used to connect PEDC to the
grid, but are also used to directly supply power distributor Panay
Electric Company Inc. (PECO). The assets are also used by another generator
Panay Power Corporation. Therefore, the facility is not a ‘dedicated
point-to-point limited transmission facility’ and must be turned over to NGCP,”
Alabanza said.
Acquisition by
NGCP of the transmission assets currently under the control of other entities
will revert the operation and maintenance of the same to NGCP, enabling it to
better discharge its mandate under EPIRA and its franchise of managing and
upholding the security and integrity of the nationwide power grid.
Once NGCP has
acquired the PEDC assets, NGCP will be able to connect these assets to the
grid. “The most important consequence of NGCP’s acquisition of these
transmission assets is that consumers of power distributor PECO will then have
the option of sourcing electricity supply with lower generation charge from
sources other than PEDC, including the wholesale electricity spot market
(WESM),” Alabanza added.
PECO is the
only distribution utility in Panay island that is not connected to the grid.
It should be
noted that compared with other distribution utilities in Panay island, PECO
consumers are paying the highest generation charge. Based on data provided by
the distribution utilities themselves, PECO charged its residential customers a
generation rate of Php8.2637/kWh for the month of May 2012. By comparison,
ANTECO, which sources its supply from the WESM, billed a generation rate of
Php5.8160/kWh to its residential customers for the same period.
For the other
distribution utilities like ILECO I, GUIMELCO, AKELCO, ILECO II, ANTECO, and
ILECO III, the combined generation and transmission charge per distribution
utility is still lower compared to the generation charge alone of PECO.
“The
application was filed with adherence to EPIRA in mind. NGCP will faithfully
discharge its responsibility as mandated by the law. That responsibility
entails making sure that all assets performing transmission functions are under
its operational control and maintenance. All of this,” Alabanza added, “will
fall under the strict scrutiny of the ERC.”(NGCP/PIA Sorsogon)
For
media inquiries, please contact: Atty. Cynthia P. Alabanza,
Spokesperson/Adviser for External Affairs (cpalabanza@ngcp.ph/09175707884); Released: Aug. 13, 2012
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