NGCP eyed to undergo audit

Separate rules on FIT collect

Manila Bulletin

By MYRNA M. VELASCO

June 8, 2011, 2:40am

MANILA, Philippines — Separate set of rules are being proposed to govern the collection of feed-in-tariff (FIT) charges which shall be placed under the jurisdiction of the National Grid Corporation of the Philippines (NGCP).

Energy Regulatory Commission (ERC) executive director Francis Saturnino Juan admitted that they have been receiving feedbacks and advanced proposals from stakeholders that there should be a specific directive that will lay down the guidelines on how the FIT collections be administered and how the books of records and accounts of NGCP for that particular function can be subjected to audit or examination.

It is expected that NGCP will set a separate account for the FIT collections – one that is independent from its function as system or grid operator.

“Cash sources are fungible, so the proposal is for NGCP to have a separate account for the FIT – that it shall be easily verifiable and we also have to make sure that they will strictly abide by their fiduciary duty in that sphere,” the ERC official has noted.

The rules, he indicated, may lay down verification processes on the collected feed-in-tariff charges; how settlement shall be undertaken and in which financial institutions the FIT accounts shall be opened and maintained.

Renewable energy developers are also raising views that NGCP must be open to audit on its books of accounts once questions on the FIT collections would rise.

As to that question, the ERC noted that a scrutiny of the NGCP’s books and records by the Commission on Audit (CoA) may be allowed because such policy has already been established when the Supreme Court allowed an examination of the books of Manila Electric Company.

Audit on the books and financial records of privately-owned utilities in the power industry may be permitted if the ERC will request it with COA; as what it has done in the case of Meralco.