The National Grid Corporation of the Philippines (NGCP) announced that its transmission wheeling rates increased in December due to the effects of cold weather, which lowered consumer electricity consumption.
In a briefing on Wednesday, Jan. 15, NGCP reported that wheeling rates, the charges for power delivery, rose by P0.0348 per kilowatt-hour (kWh), a 7.22 percent increase. This means that the billing period from November to December saw an increase from P0.4957 per kWh to P0.5315 per kWh.
As of last month, average transmission wheeling rates were P0.0399 per kWh in Luzon, P0.0251 per kWh in Visayas, and P0.0358 per kWh in Mindanao.
Conversely, ancillary service (AS) rates dropped by P0.0280 per kWh in Luzon and P0.0291 per kWh in Mindanao. The AS reserve market led to a decrease of P0.2596 per kWh in Visayas.
Nationally, average transmission wheeling rates climbed by P0.0358 per kWh, while average ancillary service rates fell by P0.228 per kWh.
Julius Ryan Datingaling, NGCP head of business and regulatory development, explained that low energy consumption caused the spike in wheeling rates. “Consumer consumption dictates the rates. Since December experienced cold weather, electricity consumption dropped. Given that revenue is fixed, this tends to increase rates,” he said.
“In general, our consumers can expect an increase in overall transmission charges on their January 2025 electricity bills,” he added.
Another spike in the next billing statement
NGCP also mentioned that it would recover costs not collected in early 2024 due to suspended reserve market operations. This means that transmission rates may rise again in February.
“In our next billing statement, starting from the March 2024 billing period, customers across Luzon, Visayas, and Mindanao will see a 70% increase in ancillary service charges,” he said. “For Luzon and Mindanao, the collection will occur over three months, and for Visayas, it will be within six months.”
He added that the exact amount has not yet been set, as they are waiting for the computation from the Independent Market Operator of the Philippines (IEMOP). “We still don’t have the exact figure; we’re just waiting for IEMOP’s statement.”
Chinese ownership?
When asked about Chinese involvement in NGCP's business operations, spokesperson Cynthia Alabanza clarified that the presence of Chinese stockholders on the board does not violate any laws. “The role of the chairman of the board in NGCP is within the bounds of the law because they are only presiding officers,” she told reporters.
Alabanza elaborated that NGCP has six Filipinos and four foreign board directors and that foreign investors do not have full control or ownership of the Philippine state-owned grid corporation.
The six Filipino stockholders are Henry Sy Jr., Robert Coyuito Jr., Francis Chua, Jose Pardo, Paul Sagayo Jr., and Anthony Almeda. The four foreign board members are Liu Xinhua, Wang Lijin, Yao Yousheng, and Zhu Guangchao.
Alabanza assured reporters that NGCP poses no national threat, as all dispatchers are Filipino citizens, and Chinese stockholders only have access to public disclosures. “They have access to publicly available information, so all that you can see, they can see too. But they cannot assert control of the transmission system of the Philippines under NGCP.”