NGCP service charge causes MORE's power rates to rise

Power rates have recently gone up this month due to the ancillary services (AS) charged by the National Grid Corporation of the Philippines (NGCP).

MORE Power reported on Saturday, March 23, that consumers will experience a P0.06 per kilowatt hour (kWh) increment owing to AS, which secure the power system’s operations.

This hike followed the full commercial operations of the Reserve Market last January, as the NGCP now charges P0.18 per kWh in transmission.

MORE Power, a power distribution utility in Iloilo, stated that its rates have recently increased from P9.96 per kWh last month to P10.0216.

“A large increase in the AS cost was due to the Contingency Reserve, with an increase almost 4 times that of the previous month,” the power utility firm explained.

The contingency reserves are power plants, which handle the grid’s loss of the largest synchronized generating unit.

Subsequently, there is a tight supply and continuous power plant maintenance happening in the Visayas grid, thus can only offer a minimum supply in the Reserve Market.

According to MORE Power, this grid obtains most of its contingency reserve requirement from the reserve market.

“Most of the participants in the reserve market are also coal suppliers and diesel plants from the Visayas grid,” it added.

Other rates, like the generation charge went down to P0.11 per kWh because of the average nodal prices in the Wholesale Electricity Spot Market (WESM). Likewise, MORE Power stated, “the Distribution, Supply, and Metering (DSM) charges go directly to us, as Iloilo City’s distribution utility remains the same.”