Power grid operator seeks rate increase

Manila Times.net
Written by : EUAN PAULO C. AÑONUEVO REPORTER


THE private firm operating the Philippines’ power grid is seeking an increase in electricity rates in Luzon to recover the cost of repairing typhoon-damaged facilities.

In a petition to the Energy Regulatory Commission, National Grid Corp. of the Philippines (NGCP) wants to recoup P80.2 million for the rehabilitation, repair and restoration of transmission line facilities downed by typhoons Basyang and Juan.

“In view of the foregoing, there is a need to realign NGCP’s capital expenditure projects to recover the cost incurred,” the company said.

To recover the amount, NGCP proposed a total rate increase of P0.82 per kilowatt-hour that will be staggered from October 2011 up to December 2015.

The company sought a rate hike of P0.13 per kilowatt-hour for 2011, and P0.17 per kilowatt-hour for 2012 to 2015.

Typhoon Basyang battered Luzon in July last year, causing damage to NGCP’s transmission line network. Typhoon Juan hit the country in October of the same year, damaging NGCP’s facilities in Northern Luzon.

“The occurrence of the aforementioned 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 majuere events, as this is not covered by the company’s insurance policy.

NGCP is owned by Henry Sy Jr. of the SM group, the Coyiutos and State Grid of China Corporation.

NGCP’s proposed rate hike follows price increases implemented by state-owned National Power Company as well as by Manila Electric Company, which distributes bulk of Luzon’s electricity requirements.

Meralco raised its rates by P0.08 per kilowatt-hour this month as a result of an increase in the cost of power it buys from various suppliers.

Meralco also has a pending petition before the ERC for an increase in its maximum average distribution price to P1.60 per kilowatt-hour from the current P1.58 per kilowatt-hour. The increase will be translated to different tariffs for its customer classes.

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