Nat'l Grid seeks higher Luzon transmission fees

By Ted P. Torres (The Philippine Star) Updated August 17, 2011 12:00 AM


MANILA, Philippines - The National Grid Corp. of the Philippines (NGCP) is asking for an increase in transmission charges that would result in higher electricity rates in Luzon.


NGCP is the private concessionaire of the country’s power transmission network, or the facilities that bring electricity from power plants to private distribution utilities and electric cooperatives. It is composed of local investors led by Henry Sy Jr. and its technical partner State Grid of China Corp.


In a petition to the Energy Regulatory Commission (ERC), NGCP said it seeks to recoup P80.29 million from consumers’ electricity bills for the rehabilitation, repair and restoration of transmission line facilities affected by typhoons Basyang and Juan.


NGCP proposed a total rate increase of P0.82 per kilowatthour (kwh) that will be staggered from October 2011 up to December 2015 in Luzon. That can be translated to a rate hike of P0.13 per kwh for 2011 and P0.17 per kwh for 2012 to 2015.


Basyang battered North and South Luzon in July last year, causing damages to NGCP’s transmission line network that, in turn, resulted to widespread power outages. Juan, on the other hand, hit the country in October of the same year, damaging NGCP’s facilities in Northern Luzon.


“The force majeure events required or requires substantial capital infusion, the recovery of which should be allowed in order not to put a financial strain in the transmission system operator,” NGCP said.


Under present regulations, NGCP may recover the cost of repairs to facilities damaged by natural calamities or force majeure events as these are not covered by the company’s insurance policy.


Recently, Manila Electric Co. (Meralco), which distributes bulk of Luzon’s electricity requirements, and state-owned National Power Corp. (Napocor), increased its rates by P0.08 per kwh this month as a result of an increase in the power it buys from power suppliers.


It has a pending petition before regulators for an increase in its maximum average distribution price of P1.58 per kWh, which will be translated to the different tariffs for its customer classes, to P1.60 per kWh.


Regulators also allowed an increase of P0.07 per kWh in consumers’ power bills to subsidize Napocor’s off-grid operations.