Group demands clear explanation of NGCP’s power rates hike petition

ILIGAN CITY (MindaNews/09 July) — A consumers group here said the National Grid Corporation of the Philippines (NGCP) should explain clearly the basis of its petition seeking another round of power rates increase.

“We asked the Energy Regulatory Commission copies of all document related to this petition so that we will be able to understand fully why they wanted an increase,” said Norberto Oller, of Lanao Power Consumers Federation (Lapocof).

The NGCP and the Power Sector Assets and Liabilities Management (PSALM) Corp. have only presented a computation which is too complex for the ordinary layman to understand, he said.

NGCP raised power rates early this year citing insufficient generation capacity which it blamed on critically low water levels in Lake Lanao and Pulangi River caused by the El Nino phenomenon.

Power rates have not gone down even with the onset of the rainy season and the NGCP announced instead it wanted another round of increase — 18.97 centavos per kilowatt-hour (kWh) in Luzon; 38.16 centavos in the Visayas, and 47.16 centavos in Mindanao, under the 17th installment of the Generation Rate Adjustment Mechanism (GRAM).

NGCP also bared an additional 3.83 centavos/kWh in Mindanao for Incremental Currency Exchange Rate Adjustment (Icera) which aims to recover foreign-exchange related expenses.

Oller said the whole country can expect a series of power rates increases as part of these applications.

“They are in fact applying regularly for power rate increases every year,” he said.

Oller refuted NGCP’s claims that Lake Lanao’s low water level caused the power shortages.

He pointed out that the power firm made use of expensive power barges, geothermal and coal plants to compensate for inadequate power from hydroelectric sources.

“That El niño phenomenon is a regular cycle of our climate and is foreseeable and predictable. They did not prepare for that,” he said.

“It is the Napocor’s incompetence that has caused these power shortages. They failed to answer us when asked if there will be no more blackouts when the lake’s normal water level is restored. They can’t truly answer us on that point because we found out that the Agus complexes can only actually produce 780 MW and yet they contracted to produce power supply amounting to 1,363 MW with and for big industries,” he said.

“Good that these industries do not operate simultaneously because if they do, they cannot supply what is needed [by these industries] and the larger sector of the society will suffer continuous blackouts,” he added.

He said Lapocof is supporting the bill that will stop the outright sale of hydro complexes in Mindanao.

Lapocof also said it supports workers at the NPC whose rights would be affected by “the Asian Development Bank (ADB)’s power sector restructuring and privatization project.”

The residual NPC has been subjected to an Operation and Maintenance Agreement (OMA) with the PSALM Corp. as part of the privatization process.

NGCP is formerly the National Transmission Corporation or Transco, one of the two firms that emerged from the split of the National Power Corporation into the transmission and generation groups at the onset of the privatization program. (Violeta M. Gloria/MindaNews)

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