August 29, 2017
NATIONAL Transmission Corp.
(TransCo) plans to take over all of the country’s power grid interconnection
projects and fund their construction by using P90-P110 billion of the
government’s share in the revenue of the Malampaya offshore gas project, its
president said.
“The direction of TransCo right now
is to do all the interconnections,” Melvin A. Matibag, TransCo president and
chief executive officer, told reporters in a recent gathering with Energy
department officials.
He said the interconnection projects
include the proposed P52-P53 billion submarine cable that will link the Visayas
and Mindanao grids via Dipolog City and the southernmost tip of Cebu.
Also included is the interconnection
of Antique province to Mindoro island, Bohol and Cebu islands and an additional
facility linking Panay and Negros islands, Mr. Matibag said.
He said TransCo had used as a
benchmark the cost cited by privately owned National Grid Corp. of the
Philippines (NGCP), which he said previously presented plans to build the
transmission facilities.
Asked about the funds from
Malampaya, he placed the current available total at P193 billion. He said the
total will still increase as the government has a share throughout the
project’s duration. The gas reserves are expected to be depleted by 2022-2024.
Mr. Matibag also said he was
considering the construction of a “redundancy” transmission facility that will
connect the grids of the two island groups on the eastern side of the country —
from Leyte to Mindanao. He said the transmission line would ride on the bridge
proposed by the Department of Public Works and highways that will connect
Visayas to Mindanao.
He said he was preparing a position
paper on the interconnection projects, which he said had been approved in
principle by the Department of Energy (DoE) and the Department of Finance.
In a Senate budget hearing on
Tuesday, Energy Undersecretary Felix William B. Fuentebella told lawmakers that
the DoE would seek clearance from the Office of the President to endorse the
power transmission facilities as priority projects for the use of the Malampaya
fund.
Asked about a possible conflict with
NGCP, which has also proposed building the facilities, Mr. Matibag said: “My
position is this, under the concession agreement, they are exclusively
operation and maintenance.”
He said under the agreement,
ownership of the existing facilities remain with TransCo.
“Since we are the owner, we can
still do that (interconnection),” he said. “And I will invoke the benefits to
the public.”
The benefits, he said, include that
the cost of building the facilities will not be passed on to consumers, an
arrangement that exists under current regulations issued by the Energy
Regulatory Commission (ERC). He said NGCP would even benefit because as the
grid operator, it can collect charges for maintaining the facilities.
Mr. Matibag said TransCo had to
“benchmark” its pricing for the projects on the figures given by NGCP as his
agency lacked the technical capability to do so.
“But I can always go lower than
that…” he said, adding he was looking at a project cost that is lower by 20-30%
than what NGCP quoted.
He also said that he expects to
complete the project faster than the 2020 target previously given by NGCP for
its proposal, saying that TransCo as a state agency can do away with the
lengthy permitting process and the hearings at the ERC.
“So the chance of interconnection
between Visayas and Mindanao is during the administration of the President
(Rodrigo R. Duterte),” Mr. Matibag said. — Victor V. Saulon
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