Tuesday, February 28, 2017

National Transmission Corp. wants bigger role in energy planning

Posted on February 20, 2017

STATE-RUN National Transmission Corp. (TransCo) wants to have an active role in writing the country’s transmission development plan in a move that is expected to expand its role in preparing the broader and long-term Philippine Energy Plan, its president said.

Melvin A. Matibag, TransCo president and chief executive officer, said he would be asking Energy Secretary Alfonso G. Cusi for a department order that would include his office in the planning stage of the transmission plan.

“I will be asking the secretary if he can issue a department order so that we will be included,” he said in a recent interview.

“We want to be included in the planning stage, in the preparation,” he said, adding that in the past this was a role handled largely by privately owned National Grid Corporation of the Philippines (NGCP), which holds the congressional franchise to operate and maintain the country’s power grid.

The transmission plan has become crucial in view of a government directive to hasten the interconnection of the Mindanao electricity to the Luzon and Visayas grids. NGCP earlier this month said it was targeting the link to happen by end-2020 and possibly cost around P52 billion.

He said the department order he was seeking should give TransCo the power to recommend the plan before this is submitted for approval to the Department of Energy (DoE), which in turn endorses the document to the Energy Regulatory Commission (ERC) and the Grid Management Committee, Inc. (GMC).

Mr. Matibag said the transmission development plan (TDP) previously completed by NGCP was for DoE approval, but a number of changes were expected after a “composite team” was created to re-assess it. He said DoE Undersecretary Felix William B. Fuentebella represents the department in that team.

Mr. Fuentebella confirmed the changes, which he said should “fast-track” the TDP process. He said with the new tack, representatives from agencies and energy stakeholders with approval powers will sit down to draft the document.

Unlike before, the new process will include ERC and GMC in the initial discussions. GMC was created by the ERC as mandated under Republic Act No. 9136, or the Electric Power Industry Reform Act (EPIRA) of 2001, to ensure that all users of the grid are represented in reviewing and making recommendations on connection, operation, maintenance and development of the grid.

“We have to check on (the Mindanao interconnection plan),” Mr. Matibag said. “It’s good that it will be interconnected ... the amount of it is another issue.”

He said TransCo’s role is important in the plan because it would be the agency’s look out after the concession agreement expires and the transmission assets and obligations are turned over to the government.

“We’re talking about it. Of course, they (NGCP) have their interest to protect. I also have my mandate to protect the consumers and the government, so we’ll just do that,” he said.

“I also want the side of the generation companies and the distribution utilities to be included in the preparation,” he added.

Separately, Senator Sherwin T. Gatchalian, who chairs the Senate energy committee, called out NGCP and ERC for their “inaction” in addressing unnecessary delays in approving applications to build new power plants.

He also pointed out the delay in clearing the entry of prospective participants in the renewable energy (RE) sector.

“There is a problem with the approval process and NGCP has to solve it. How can we lure investors and promote RE and other sources of power to come in when there are unnecessary delays in the approval process?” he said.

On Thursday, the Joint Congressional Power Commission (JCPC), the legislative panel that oversees the implementation of EPIRA, held its first meeting since 2014. It tackled, among others, the slow permitting and approval process.

“I want you to take a look into this issue,” Mr. Gatchalian told ERC Chairman Jose Vicente B. Salazar. “You are not exercising your powers and authority. You have to be more aggressive.”

He ordered Mr. Salazar to submit to the JCPC a course of action, including possible sanctions, in relation to the extended time it had taken NGCP to conduct a grid impact study, which is required for power developers to proceed with the construction of their projects. -- Victor V. Saulon

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