The National Grid Corp. of the Philippines (NGCP) is set to reinvest its revenues in 20 projects targeted for implementation this 2017 to improve the country’s transmission network.
Seven out of the 20 projects are major backbone projects, including Tuguegarao – Magapit 230-kV, Luzon and Visayas Voltage Improvement, Mindanao 2300kv Backbone, Cebu-Negros-Panay 230-kV Interconnection, Pablibalo extra-high voltage project, Hermosa-San Jose 500-kV, and Calaca-Dasmarinas 500-kv projects.
“These are all backbone projects. [The revenues we collect] will come back to the grid as investments,” NGCP spokesperson Cynthia Alabanza said.
The construction of the projects will begin construction this year that will take about three to five years to finish.
Alabanza added that NGCP has been cleared to collect an interim maximum annual revenue (iMAR) of 43.79 billion this year until the Energy Regulatory Commission (ERC) renders its decision on the performance-based regulation (PBR) rules.
“So far, we’re fixed in P43-billion unless there will be another issuance for the next PBR,” Alabanza said.
MAR is the maximum revenue that NGCP is allowed to earn through its transmission operation.
ERC has also allowed the NGCP to lift its revenue target to P43.79 billion for 2016, of which the P2.14 billion under-recovery will be recovered this year, Alabanza added.
This has reflected in the bills of Manila Electric Co. (Meralco) customers this month as transmission charges went up by P0.15 per kilowatt – hour due to NGCP’s higher iMAR implementation and higher ancillary service charges.
The PBR is a rate – setting methodology by the ERC to determine the distribution and transmission rates.
This costly projects will add to the present customers high electric bill. The main reason for installing these new transmission lines is for the new coal fired power plants to be able to export their generated power to the users i.e. to Metro Manila. The upgrade of the Hermosa substation and the transmission line to San Jose is mainly for the coal fired power plants in Limay (Mr. Ang’s coal fired power plant), coal fired power plant in Mariveles (Ayala & Aboitiz) and the future coal fired power plant in Subic (Mr. Pangilinan’s coal fired power plant). With the coming approval and ratification of the Paris Climate Change (COP21) by July 2017 this project has to be reviewed and ensure that this project is in line with the objective of this agreement i.e. transmission line shall be able to accommodate renewable energy source, future power plant in Subic might not be needed, conversion of Sucat and Malaya to gas may be is the best option as it will not require new transmission lines and less power loss as it is located near the users and is also compatible with renewable energy. There is a need to rethink how we generate, transmit and distribute our electricity to lessen the customers burden and ensure efficient, reliable and sustainable power supply system in the future.