Weak power and the recent power outages in Luzon pose a serious threat, not only in our Covid-19 response measures, but also to our economic recovery
President Rodrigo Duterte has called on the National Grid Corporation of the Philippines (NGCP) to comply with the Department of Energy’s order to provide sufficient levels of ancillary services and power reserves.
In a televised briefing on Monday, Duterte stressed the need for stable power outages in Luzon to sustain the government’s response measures against coronavirus and to spur economic growth.
“I hold everyone responsible for complying with the regulations,” the President said.
“Weak power and the recent power outages in Luzon pose a serious threat, not only in our Covid-19 response measures, but also to our economic recovery,” he added.
Duterte noted that the NGCP opposed the directive and claimed that consumers would suffer from “soaring” power rates if it heeds the DoE’s call.
According to a department circular issued two years ago, the NGCP is required to procure 100 percent of reserves to guarantee the reliability of the grid, saying it can oblige providers to deliver power whenever it is needed.
The DoE said its 2019 ancillary service policy clearly stated that NGCP may engage in forward contracting, which allows the entry of additional capacities.
Earlier, the NGCP said it would comply with the department’s directive to enter into firm contracts for backup power, but it maintained its position that the move would increase power prices.
The corporation added that it would ask the Energy Regulatory Commission (ERC) to review the policy’s impact.
Energy Secretary Alfonso Cusi was quick to argue that it was not for NGCP to say that electricity will be more costly if they comply.
“It’s not optional to have the reserve. If it wants to help consumers, it should just reduce the transmission fees,” he told the Tribune.
While maintaining enough reserves remains an issue, another source disclosed that several generation companies proposed to provide power source to NGCP but the latter barred the entry of new power players in an effort to monopolize the grid operations.
The industry official said about eight generation companies offered to provide ancillary services but NGCP did not accept the offer “because they don’t want others to penetrate their system.”
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