Transco seeks to cover backlog through loan from multilateral lenders

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The National Transmission Corp. (Transco) plans to cover the P8-billion backlog to be paid to renewable energy developers system through a zero-percent interest P15-20 billion loan from World Bank and Asian Infrastructure Investment Bank (AIIB).

“We have only made 72 percent in payment so the outstanding is about P8.1 billion as of July 5,” Transco compliance monitoring department manager Dinna Dizon said in the second Philippine Hydro Summit last July 12.

The payment, which is under the Feed-in Tariff (FIT) system, has been billed a total of P30 billion from 1,107.8 megawatts (MW).

Though the agency has not been remiss in its collections, according to president Melvin Matibag, the backlog is a result of regulatory lag.

“In fact, Transco has a 99 percent collection efficiency but the problem is our collections are not enough,” he said.

As a solution, Matibag eyes multilateral lenders like AIIB and World Bank to borrow the backlog, as the two banks are known to have energy funds for renewable.

“I am talking to the AIIB and World Bank if they can loan us zero interest, which we will use to pay developers with the commitment na all that all of our collection in the coming years will be paid back,” Matibag said.

“I’m looking at Php15-20 billion including buffer because we’re eyeing zero percent interest. I’m preparing the memo by the end of the month,” he added.

The application for load has been acknowledged by Finance Secretary Carlos Dominguez and approved-in-principle by Energy Secretary Alfonso Cusi.

The increase of the FIT-All rate last month, 18.3 centavos, was aimed to cover the P6.6 billion to renewable developers under the FIT System.

However, the amount has ballooned to over Php8 billion because “the FIT All fund has yet to receive collection for the 18.3 centavos per kWh because this was just implemented starting June billing period,” Dizon said.

FIT-All is a uniform charge billed to all on-grid electricity consumers, reflected as a separate component in their monthly electricity bills paid to developers.