Experts says NGCP-TMI misrepresent ancillary services ERC application

By Tony Abejo, President, Mangagawang Media Ng Mindanao

Cagayan de Oro City----Power industry experts believed that the National Grid Corporation of the Philippines (NGCP) and the Therma Marine Incorporated (TMI) have misrepresented themselves in applying for Ancillary Service Procurement Agreement (ASPA) to the Energy Regulatory Commission (ERC).

On March 2010, the National Grid Corporation of the Philippines (NGCP) and the Therma Marine Incorporated (TMI) had submitted their application for approval the Ancillary Service Procurement Agreement (ASPA) to the Energy Regulatory Commission (ERC) between the NGCP and TMI with prayer for Provisional Authority (PA) together with separate application for Power Barges 117 and 118 and both were given provisional approval by the energy regulating body and on the following month of April, NGCP billed electric cooperatives in Mindanao including private power utilities P335,717,087.00 for the months of February, March and April.

The said billing shocked electric cooperatives, private power distribution utilities and consumers because the billings doubled than their previous billings even though they consumed less because of the power curtailment.

The excessive and unreasonable power rates forced electric cooperatives, power distribution utilities, electric consumers including Non Government Organizations, religious groups, concern citizens and the MEDIA to form a coalition during the June 25, 2010 forum at the Fatima Catholic Church at Camaman-an, Cagayan de Oro City.

Power industry experts citing the Electric Power Industry Reform Act (APIRA), said that it is the National Power Corporation (NPC) and the Power Sector Assets and Liabilities Management Corporation (PSALM) should have contracted Therma Marine Incorporated and not the NGCP for the ancillary services by using TMI Power Barge 117 and 118 which is not covered by ancillary services but by Power Supply Agreement (PSA) that is supposed to be contracted by NPC-PSALM.

They further said that the energy supply operation contracted at ancillary cost shocked industries distribution utilities and end consumers who were “electrified” to pay twice their normal pre-crisis billing at much reduce electricity consumption because of power curtailment from 1^st quarter to 2^nd quarter of 2010.adding that there is no need for ancillary services because it is not significant and not priority when the Grid is in abnormal state characterized by power deficiency or when generating capacity is lower that the demand of the system because the Grid Code said that ancillary service aims security which means continues operation of the power system in normal state and among the features of normal state is that there should be operating margin.

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Due to the unreasonable power rates, the Association of Mindanao Rural Electric Cooperatives filed a petition to the Energy Regulatory Commission (ERC) docketed as ERC Case No. 2010-030, “Petition for the determination of computation of ancillary charges billed by the National Grid Corporation of the Philippines (NCGP) to its member – electric cooperative’s (EC), and pending resolution thereof, to allow payment of the March 26 – April 25, 2010 NGCP billing as staggered payment basis for a period of twelve (12) months” aside from separate cases filed against NGCP-TMI by some electric cooperatives.

The petition was submitted to the ERC on June 21, 2010 at Pasig City and received by Atty. Francis Saturnino C. Juan, Executive Director III.

According to our source at the electric coop said that it is the Energy Regulatory Commission (ERC) will decide if NGCP and Therma Marin Incorporated misrepresented themselves in their application for ASPA.(with reports from PJTremedal,BNDMisOC-CIB-OCM)