Electricity consumers will see higher transmission charges in February 2025, as Ancillary Service (AS) rates rise by 12%, reaching P0.6640 per kilowatt-hour (kWh) from P0.5928 per kWh in December 2024.
While the National Grid Corporation of the Philippines (NGCP) is responsible for the collection of AS charges, it clarified that it does not profit from these fees, as they are pass-through costs remitted directly to power generators providing grid stabilization services.
Ancillary Services (AS) refer to the support services needed to maintain grid stability and balance power supply and demand fluctuations. These services, which include frequency regulation, spinning reserves, and voltage support, are procured by the National Grid Corporation of the Philippines either from the AS Reserve Market or through bilateral contracts with power generators.
According to NGCP, last month’s adjustment also includes the first tranche of the 70% AS transaction from the Reserve Market, which was deferred by the Energy Regulatory Commission (ERC) in March 2024.
In addition to the higher AS charges, transmission wheeling rates, which the NGCP collects for delivering power to distribution utilities, have also increased slightly to P0.5422 per kWh, up from P0.5315 per kWh in the previous billing cycle. As a result, the total transmission charge for February 2025 stands at P1.3504 per kWh, compared to P1.2583 per kWh in December 2024.
The National Grid Corporation of the Philippines (NGCP said only 54 centavos of the total transmission rate represents its service charges for power delivery. The majority of the increase is due to Ancillary Service costs, which are remitted directly to power generators supplying reserve power to stabilize the grid.
“Only 54 centavos of the overall transmission rate is charged by the National Grid Corporation of the Philippines for the delivery of its services to power consumers. This month’s transmission charge is comprised mainly of AS charges remitted directly to power generators providing ancillary services to the grid,” the company said in a statement.
The increase in Ancillary Service charges means that consumers will see a higher portion of their electricity bills allocated to transmission costs, which include the cost of maintaining grid reliability. While the NGCP is responsible for procuring AS, the actual rates are influenced by market conditions, fuel costs, and demand fluctuations affecting power generators.
How do you feel about the increase in Ancillary Service charges and its impact on transmission costs? Share your thoughts in the comments below, and follow Power Philippines for the latest updates on energy prices and regulatory changes!
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