Ancillary service costs drive up NGCP rates

Ancillary service (AS) charges have pushed up transmission rates in February electricity bills, with AS rates rising 12 percent to P0.6640 per kilowatt-hour (kWh) in the January billing period from P0.5928/kWh in December 2024.  

NGCP head of revenue management Julius Ryan Datinggaling said during a press conference Wednesday that the increase included the first tranche of the 70 percent AS transaction from the Reserve Market incurred in March 2024, which had been deferred by the Energy Regulatory Commission. 

AS costs cover services procured from the AS Reserve Market and those from providers with bilateral contracts with the National Grid Corporation of the Philippines (NGCP).  

Transmission wheeling rates, which NGCP charges for delivering power, rose to P0.5422/kWh from P0.5315/kWh. Overall transmission charges reached P1.3504/kWh in January 2025, up from P1.2583/kWh in December 2024.  

Low consumption

“For the NGCP’s wheeling rates, there is a slight increase of 1 centavo per kilowatt-hour. This slight increase is still due to the low electricity consumption this month of January. 

You know that we have fixed revenue and that fixed revenue is the rating divided by consumption, so when consumption is low, there is a slight increase in wheeling rates,” Datinggaling explained. 

Of the total transmission rate, only P0.54/kWh is charged by NGCP for its services, with most of the increase coming from AS charges remitted directly to power generators. 

Datinggaling reiterated that NGCP does not earn from AS charges, as these are passed through to generating companies that provide support services to stabilize the grid during supply-demand imbalances.