The Energy Regulatory Commission is targeting to release its decision on the rate reset application of the National Grid Corporation of the Philippines by August — a move expected to slash the transmission rates charges to power users.

“August is our target month for the completion of the reset. The ongoing NGCP audits are all inputs to the rate reset,” ERC chairperson lawyer Monalisa Dimalanta said in a text message to the Daily Tribune.

“We have completed most of it and it is now undergoing evaluation by the Commission staff as we conclude the hearings on the rate reset application,” she said.

Rates resetting

In December 2022, the NGCP applied the resetting of the transmission rates before the ERC.

NGCP’s application followed the ERC’s denial of its Omnibus Motion to hold the rate reset in abeyance until the ERC holds another round of public consultation on the rules and after the ERC has clarified certain provisions in the Amended Rules for Setting Transmission Wheeling Rates.

The application filed by NGCP covered the Fourth Regulatory Period.

Simultaneous to the filing of the application, NGCP also filed a Petition for Rulemaking to change the coverage of the 4th Regulatory Period in the Amended RTWR to between  2016 and 2020.

Transmission reset is regularly done to check whether the allowed revenues of NGCP approved seven years ago are still valid, reasonable, and reflective of the current costs for consumers.

The last transmission reset was done for regulatory periods covering 2011 to 2015.

Diligent review

In another related development, Dimalanta assured the Senate and electricity consumers that the ERC will conduct a “diligent review of the complaints, delays and possible violations of NGCP.”

“We are prepared to enforce the full force of the law as appropriate based on the findings,” she said.

Dimalanta was responding to Senator Sherwin Gatchalian’s call to penalize the NGCP for delayed transmission projects that adversely impact the country’s electricity supply.

“I strongly suggest to the commission to enforce fines and penalties so we can impose discipline on NGCP. We are not seeing discipline because a lot of projects are delayed,” Gatchalian said, referring to the delayed projects of NGCP that include backbone transmission projects.

Based on the latest record, the completion of about 66 transmission projects is currently delayed —excluding six projects of national significance.

25-year franchise

The NGCP holds a 25-year franchise to solely operate the power transmission assets of the government and secure power reserves for contingency.

Among others, NGCP is undertaking the P52-billion Mindanao-Visayas Interconnection Project or MVIP. The DoE previously said the project will launch within the first half of the year but will be pushed back anew to an indefinite date still within the year.

The MVIP will link together all three major Philippine islands to create one grid.

The NGCP was authorized by the ERC to start building the project way back in 2017. It was initially scheduled to be completed in 2020 but it was delayed due to the pandemic.