Transmission operator National Grid Corporation of the Philippines on Thursday filed with the Energy Regulatory Commission an application to reset the transmission rates charged to power end-users.
NGCP also complied with ERC’s order to pay penalties amounting to P5.1 million for non-compliance with the circular issued by the Department of Energy requiring the procurement of reserves.
The ERC said NGCP’s application came after the regulator denied its omnibus motion to hold the rate reset in abeyance until another round of public consultation on the rules was conducted.
NGCP sought clarification on certain provisions in the amended rules for setting transmission wheeling rates.
The ERC denied NGCP’s omnibus motion in a order dated Nov. 25, stating that several public consultations on the amendments to the RTWR were held since 2014, all with NGCP’s participation.
It also addressed NGCP’s requests for clarification in the said order.
The ERC promulgated Resolution No. 08, Series of 2022, or the Amended RTWR on Sept. 28 this year.
The Amended RTWR covers the rate reset for the fourth (2016 to 2022) and fifth regulatory periods (2023 to 2027).
The last transmission reset completed by the ERC was in 2010, for the regulatory period covering the years 2011-2015. The application filed by NGCP covers the fourth regulatory period.
NGCP also filed a petition for rule-making to change the coverage of the 4th regulatory period in the Amended RTWR to 2016 to 2020.
The ERC will commence next month the hearings on the application and the process of verification of the completeness and accuracy of the information submitted by NGCP.
“The rate reset is expected to result in lower transmission charges for the benefit of electricity consumers,” it said.
ERC chairperson Monalisa Dimalanta said NGCP’s application is a positive development towards resolving the long regulatory lag in the energy sector.
“We are encouraged by NGCP’s cooperation in filing its application for a rate reset. We view this as an alignment of interests among the regulator and energy stakeholders to pursue moving our energy sector towards a regime of higher level of compliance and accountability,” Dimalanta said.
Meanwhile, the ERC said NGCP paid its P5-million penalty on Nov. 21, 2022.
The ERC ruled that NGCP violated Sections 7.4 and 7.5 of DOE Department Circular No. DC2021-10-0031, entitled “Prescribing the Policy for the Transparent and Efficient Procurement of Ancillary Services by the System Operator.”
The AS-CSP Policy requires all ancillary services or reserves needed for the Grid to be procured under an open and competitive process under a firm contracting agreement.