Additional power charge looms for Visayas users

Business World Online
Posted on November 10, 2014 11:18:00 PM
By Claire-Ann M. C. Feliciano, Senior Reporter

ELECTRICITY consumers in the Visayas could end up paying an additional charge as the National Grid Corporation of the Philippines (NGCP) seeks to recover P2.57 billion in costs incurred to repair transmission facilities damaged by typhoon Yolanda (international name: Haiyan) in November last year.
Typhoon Yolanda caused severe damage to Visayas transmission facilities. -- interaksyon.com
The grid operator, in a Nov. 4 application, asked for the Energy Regulatory Commission’s authorization to implement and bill force majeure pass-through amounts to power distributors in the Visayas.

NGCP explained that typhoon Yolanda -- which hit the country on Nov. 8, 2013 -- made several landfalls in Eastern Samar, Leyte, Cebu, Iloilo and Palawan.

“Due to the strong winds and heavy rainfall of typhoon Yolanda, NGCP’s transmission assets and other related facilities in the Visayas area were severely damaged causing massive and widespread power interruption over the area,” NGCP said in the petition released yesterday.

“As a result, NGCP incurred additional cost for the repair, restoration and rehabilitation of transmission assets damaged by the typhoon,” it added.

NGCP proposes to collect total expenditures amounting to P2,569,270,320.87 from January 2015 to December 2020, or until the cost incurred is fully recovered.

This is equivalent to a charge of P0.1874 per kilowatt-hour (/kWh) in 2015; P0.0257/kwh in 2016; P0.0241/kWh in 2017; P0.0227/kWh in 2018; P0.0214/kWh in 2019; and P0.0201/kWh in 2020.

These charges will be collected by NGCP from its customers, which are distribution utilities and electricity cooperatives that use the country’s transmission facilities.

In turn, power distributors will be the ones to compute the equivalent of these transmission charges to determine the rate impact to the electricity end-users.

The transmission charge accounts for around 10% of a customer’s monthly power bills.

In its petition, the grid operator emphasized that the typhoon required “massive capital infusion,” thus, its recovery should be allowed immediately “to avoid any financial strain in the operation of NGCP and allow the continuous provision of transmission service to the grid customers.”

NGCP is private firm that operates, maintains and develops the country’s transmission network since 2009.

The firm is in charge of the transmission of high-voltage electricity through power superhighways that involve an interconnected system of transmission lines, towers, substations, and related facilities.

It acquired the 25-year concession of National Transmission Corp. in an auction conducted by the Power Sector Assets and Liabilities Management Corp. in 2008 where it submitted a $3.95-billion bid.

NGCP is a consortium composed of the State Grid Corporation of China (40%), One Taipan Holdings Corp. (30%) and Calaca High Power Corp. (30%). source