Napocor seeks to recover P1.65B in costs under GRAM

Napocor seeks to recover P1.65B in costs under GRAM

The National Power Corp. (Napocor) has asked in its application for the generation rate adjustment mechanism (GRAM) to recover P1.65 billion in fuel costs that shouldered the delivery of power in off-grid areas in 2014.

The firm asked the Energy Regulatory Commission (ERC)’s approval for GRAM deferred accounting adjustment (DAA), citing the costs involved in providing power to missionary areas from July to December 2014.

The Electric Power Industry Reform Act (EPIRA) of 2001, also known as Republic Act (RA) 9163  allows for the cost recovery within a two-year period.

“The proposed 14th GRAM DAA is fair and reasonable as it is computed in line with the GRAM rules and consistent with the principles of free and competitive electricity market as provided under R.A. 9136,” the application read.

The state-run firm performs its missionary electrification role through the Small Power Utilities Group (SPUG), which incurs additional operating costs due to the fluctuation of fuel prices used in power generation.

This means that proposed charges will be P1.56 per kilowatt-hour (kWh) in Luzon, P2.02 per kWh in Visayas and P1.30 per kWh in Mindanao. Customers in the Napocor-SPUG areas will shoulder the costs.