ERC demands NGCP explanation on project delays

The Energy Regulatory Commission (ERC) has ordered the National Grid Corporation of the Philippines (NGCP) to explain why there are delays in the 33 transmission projects it it earlier sought regulatory approval.

“We have directed the NGCP to explain in detail the changes in the timeline and the events or activities that led to the modification of the transmission projects’ completion,” ERC Chairperson Agnes Devanadera said in a statement.

The ERC also once again reminded NGCP to enter into ancillary services (AS) contracts in compliance with Republic Act 9136 or the Electric Power Industry Reform Act (EPIRA), as well as update the quasi-judicial regulator of the status of its negotiation, if any, of the additional AS, particularly the contingency reserve.

Under Sections 8 and 21 of the EPIRA, NGCP has the responsibility for the planning, construction and centralized operation and maintenance of its high voltage transmission facilities, including grid interconnections and AS.  The ERC has approved the Ancillary Services Procurement Plan (ASPP) which sets the required level of the AS.

“The completion of the NGCP transmission projects is a crucial element in ensuring the stability of electricity in the entire country. In the same manner, there must be sufficient Ancillary Services Procurement Agreement (ASPA) in place to support the transmission of power capacity and energy from generation sources to consumption loads and maintain the reliable operation of the transmission system,” Devanadera added.

The Department of Energy (DOE) has pointed to the lack of AS as one of the key reasons for the Red Alerts leading to the rotational brownouts in Luzon last week, as well as in 2019.

The DOE formulated the AS policy also in 2019, which required NGCP to have firm contracts, including the negotiation of non-firm to firm contracts. However, the department said that the grid operator has yet to comply with the required firm AS contracts.

Meanwhile, the NGCP said it has no power over electric industry players and brownouts.

In an interview with CNN Philippines, NGCP spokesperson Atty. Cynthia Alabanza pointed out that some power plants failed to give them advance notice, triggering last week’s Red Alerts. Normally, plants give seven-day notices prior to emergency shutdowns, but many didn’t comply this time, she emphasized.

The DOE has warned of another series of Red Alerts until Thursday.