MANILA, Philippines—State-run National Power Corporation expects regulators to consider its appeal and raise the subsidy for missionary electrification projects to P13.9 billion.
Napocor president Froilan A. Tampinco said that the power firm had filed a motion for reconsideration before the Energy Regulatory Commission to increase the funds for its projects under the small power utilities group (Spug).
Spug is Napocor’s missionary electrification arm, providing electricity to remote islands and far-flung, inland barangays that are not connected to any of the main grids. Funding for these projects is shouldered by all power consumers through the universal charge for missionary electrification (UCME).
“It seems like the ERC will be coming out with a decision on the motion for reconsideration that we filed within the week. So hopefully, we’ll get additional funds for this UCME. Then that would translate into better operational flexibility for us in the Spug areas,” Tampinco said.
Tampinco said the current UCME rate, which is lower than the previous charge, will result in “reduced operational flexibility.”
He stressed the need to increase funds being collected via the universal charge, especially since Napocor has been barred by the Department of Justice from conducting any fund raising activities such as issuing bonds.
Based on the ERC decision last September, the UCME has been pegged at 4.54 centavos per kilowatt-hour (kWh) from the previous charge of 9.78 per kWh.
The amount approved by the ERC is equivalent to a budget of P2.76 billion for Napocor Spug’s projects this year—barely a fifth of what it initially sought.
In its original filing, Napocor wanted to increase the UCME to 22.89 centavos per kWh, equivalent to an operational subsidy of P13.9 billion.
The ERC decision translated to a cut in capital expenditures and operations of the group. The approved budget is also less than the average subsidy of up to P6 billion usually granted for Spug projects each year.
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