Wednesday, October 4, 2017

Govt-owned Transco to compete vs telcos



By Lenie Lectura - 

STATE firm National Trans-mission Corp. (Transco) wants to diversify into the telecommunications business, saying it has the assets to compete with telecommunication giants PLDT Inc. and Globe Telecom Inc.
“We want to be a provider of telecom [telecommunication] facilities,” Transco President Melvin A. Matibag said. “We will compete with the telcos [telecom companies].”
Transco, owner of the country’s transmission assets, was created under Republic Act (RA) 9136, otherwise known as the Electric Power Industry Reform Act (Epira) of 2001.
Since March 1, 2003, Transco operated and managed the power-transmission system that links power plants to the electric-distribution utilities nationwide. The same law mandated the privatization of Transco through an outright sale or management-concession agreement.
Following a public bidding conducted in December 2007, the Transco concession was awarded to the National Grid Corp. of the Philippines (NGCP), which eventually secured a congressional franchise to operate the transmission network through RA 9511.
Transco turned over the management and operation of its nationwide transmission system to the NGCP in January 2009. Ownership of all transmission assets, however, remained with Transco.
Matibag said “it makes sense” to venture into the telco business, since “we are the owner of the facilities”, he said, referring to the fiber-optic cables that could be tapped to bring Internet connection all over the country. Besides, he added, the trend now is diversification.
“I want Transco to diversify, just like telcos and other private companies are doing.”
What needs to be done first, according to Matibag, is to ask Congress to amend Transco’s charter so it could legally offer telco services.
“Recalibrate the law” that created Transco, which is the Epira, he said.
“Congress has the power to do that. I want Transco to not only be a transmission company but also a telco,” Matibag added. “This is a long process, but we have to start now.”
If his proposal pushes through, Matibag said Transco would be renamed as the National Transmission and Telecommunications Co.
“Funding will be the least of concern when we would have the franchise and power to do that. After all, we are the owner of the facilities. Globe and Smart [Communications Inc., a PLDT subsidiary] are using our towers for telecommunications.”
Matibag said he would formally submit his proposal to Congress before the end of the year. He is confident that the  majority of the lawmakers will sponsor his proposal.
Currently, as owner of the transmission assets, Transco is mandated with five key responsibilities.
One of these is to protect national government’s interests by ensuring NGCP’s compliance with the terms and conditions of the Concession Agreement and the policies of the Department of Energy. Another responsibility is the handling of all existing cases, including right-of-way, and claims that accrued prior to the turnover date.
Other responsibilities of Transco include:
■ To divest remaining sub-transmission assets to technically and financially qualified electric distributors nationwide;
■ To undertake the operation, maintenance, consultancy and other technical services for the Philippine Economic Zone Authority; and
■ To administer the Feed-in-Tariff Allowance Fund for renewable energy generators.

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