NGCP clarifies higher transmission charges for Sept

MANILA, Philippines —The National Grid Corp. of the Philippines (NGCP) has clarified that only generation companies have benefited from higher transmission charges for the September power bills.

Transmission rates have increased this month due to higher ancillary service (AS) charges following the resumption of commercial operations of the power reserve market last month.

At a press conference yesterday, the grid operator argued that it gains no financial benefit from AS and does not benefit from the increase in prices.

The NGCP said the AS cost, or fees charged to support services used to balance and stabilize the grid during supply-demand imbalance, is a pass-through cost collected for power suppliers.

For the August supply period, AS rates increased by 125.92 percent to P0.6127 per kilowatt-hour from the preceding month’s P0.2712 per kWh.

Meanwhile, transmission wheeling rates, or what NGCP charges for its primary service of delivering power, went down by 5.5 percent to P0.4761 per kWh from P0.5038 per kWh in July.

In May, the Energy Regulatory Commission (ERC) ordered the partial lifting of the suspension on settlement amounts in the AS reserve market and authorized a 30-percent cost recovery for the March billing period.

“In compliance with directives from the Department of Energy and the ERC, the NGCP contracts 50 percent of its AS requirement from firm agreements and 50 percent from the AS reserve market,” the company noted.

Earlier, power distributor Manila Electric Co. (Meralco) announced a rate increase of P0.1543 per kWh this month, bringing the overall rate to P11.7882 per kWh in September from last month’s P11.6339 per kWh.

The latest adjustment, which marks the third straight month of hikes, translates to an increase of around P31 for the electricity bills of typical households consuming 200 kWh a month.

Meralco attributed the higher power rate to the P0.2913 per kWh rise in transmission charges, which offset the P0.1547 per kWh reduction in generation costs.