Senators criticized the National Grid Corporation of the Philippines (NGCP) for prioritizing dividends to its shareholders instead of fulfilling its obligations to deliver transmission projects.
They deemed this practice unjust and called on the Energy Regulatory Commission (ERC) to take immediate action to address it.
NGCP’s Assistant Vice President Cynthia Alabanza admitted in her response to Senator Sherwin Gatchalian that consumers are being billed for projects and expansions that still need to be completed.
Alabanza also stated that it is difficult to determine the exact amount collected from consumers by NGCP and whether the cost of these projects is included in the transmission charge.
The generation charge, which represents the cost of purchased electricity from suppliers, constitutes 55% of a customer’s total monthly bill, while the transmission charge, which covers the cost of delivering electricity to the system, accounts for 10.1%.
Meanwhile, Sen. Rafael Tulfo raised concerns to ERC Chair Monalisa Dimalanta regarding the collection of fees for unfinished projects according to the law. In response, Dimalanta explained that the ERC order, specifically the Interim Maximum Annual Revenue (iMAR), grants NGCP the authority to increase its income ceiling, allowing them to collect such fees.
Under the iMAR, NGCP is authorized to increase its income ceiling from Php 43 billion in 2019 to Php 47.1 billion in 2020.
Sen. Tulfo also criticized the ERC for granting the NGCP such authority, labeling it as ‘shameless’ due to the lack of consumer benefits from the projects.
ERC assured that they will enforce the law to hold NGCP accountable for the delayed projects, which adversely affected service delivery and increased consumer bills.
However, Energy Undersecretary Sharon Garin informed the Senate committee that both the Department of Energy (DOE) and ERC have limited authority in this matter. Garin explained that ERC’s maximum fine for violations is only Php 50 million, indicating their constrained ability to address the issue.
NGCP earlier explained that there were delays in implementing 33 projects in Luzon, 19 in Visayas, and 14 in Mindanao due to reasons “beyond control.”