ERC to physically inspect NGCP facilities

Published May 24, 2022, 3:52 PM

by Myrna M. Velasco

The Energy Regulatory Commission (ERC) will undertake physical inspection of the facilities as well as audit of operations of transmission firm National Grid Corporation of the Philippines (NGCP) in line with its fifth regulatory reset or before it can approve the new rates for customers.

According to ERC Chairperson Agnes T. Devanadera, the physical inspection of the NGCP assets will be a necessary exercise that the regulatory body and its consultants will be carrying out before the new NGCP tariffs will be approved.

She qualified that the audit on NGCP facilities and assets will be carried out as part of the audit proceedings linked to the updating of the company’s tariffs based on performance-based ratesetting (PBR) methodology.

“We have difficulties initially because our consultants could not conduct physical inspection – that’s why there’s delay on that…but we should really have them in because we will be doing the reset,” the ERC chief said.

With the lifting of mobility restrictions under the Covid-19 protocol, Devanadera emphasized that the ERC international consultants can now conduct field work for the audit process on NGCP.

She specified that the Commission secured the approval of Congress for P50-million funding that they will need for the audit and evaluation of NGCP’s assets and operations.

The transmission company announced last month that it will inject capital expenditures (capex) of P160 billion for expansion projects as well as upgrade of its facilities to reinforce the operation of the country’s power transmission network.

The capex rollout has been integrated in the application-filing of NGCP for its 5th regulatory reset; wherein it programmed the concretization of new and expansion projects for regulatory years 2022 to 2025.

The array of projects it will implement will be substation and transmission line reliability projects; upgrading of operation and maintenance (O&M) tools; equipment as well as network facility improvements with the introduction of smart grid technology.

The company will likewise be pursuing upgrade on its SCADA/EMS system; and that shall be done in parallel with the expansion of grid-related telecommunications facilities; further enhancements of cybersecurity systems; and power quality monitoring.