NGCP cleared to acquire more transmission assets

Manila Times.net
Published : Wednesday, October 19, 2011 00:00 Written by : EUAN PAULO C. AÑONUEVO


THE National Grid Corp. of the Philippines (NGCP) is looking to acquire transmission assets controlled by distribution utilities.


Cynthia Manrique, NGCP revenue and regulatory affairs head, said Energy Regulatory Commission Resolution 16, which adopts amended rules on the definition and boundaries of connection assets for the customers of NGCP, mandates the latter to acquire transmission facilities held by power distributors.


“This gave NGCP cause to assess the existing assets on the grid, and determine whether all the essential and crucial assets performing vital transmission functions were within its operational control and maintenance,” Manrique said.


Section 21 of the Electric Power Industry Reform Act of 2001 mandates that NGCP, as government concessionaire, be solely responsible for the improvement, expansion, operation, and/or maintenance of the country’s transmission assets. It is the only entity that possesses the required technical expertise to maintain and operate the nationwide power grid.


“Acquisition by NGCP of the transmission assets currently under the control of other entities will revert the operation and maintenance of the same to NGCP, enabling it to better discharge its mandate under Epira and its franchise of managing and upholding the security and integrity of the nationwide power grid,” Manrique said.


In line with its plan to consolidate the country’s transmission assets, NGCP recently filed an application with the ERC to seek approval of its capital expenditure for the acquisition of several such assets, including those under the control of Panay Energy Development Corp.


PEDC is connected and supplying power to the grid through NGCP’s Sta. Barbara substation.


Among PEDC’s transmission assets are a switchyard, transformers, power circuit breakers, transmission line, SCADA and microwave system, and the lot where the switchyard was constructed.


“Once NGCP has acquired the assets, the capital expenditure recovery cost of the assets will be carved out from PEDC’s rate and then included in NGCP’s rate. Overall, the impact will be even lower tariff for all Visayas grid users because the cost [to be collected by NGCP] will be shared by the entire grid, not just the power consumers of Panay,” Manrique said.


NGCP also filed similar applications with the ERC for the acquisition of transmission assets owned, operated and maintained by the Cebu Energy Development Corp., Visayan Electric Co. and Manila Electric Co.


NGCP is evaluating other assets across the country owned by other entities that may also be performing transmission function. Under its concession agreement with the government, all transmission assets acquired by NGCP shall be turned over to the state at the end of the concession period.