ERC to NGCP: Refund P12 B to Mindanao customers

MANILA, Philippines - The Energy Regulatory Commission (ERC) has ordered the National Grid Corp. of the Philippines (NGCP), the country’s power transmission operator, to refund P12 billion to its customers in Mindanao for ancillary services charged to them.

In an order, the power sector regulator said NGCP can implement the refund in 12 months or P1.05 billion per month.

“Accordingly, NGCP should reflect the refund to its customers starting the next billing cycle upon the receipt of this order,” the ERC said.

The ERC said the net refundable amount is P12.69 billion for a monthly refundable amount of P1.057 billion. This would translate to an estimated decrease in electricity bills of P0.0015 per kilowatt-hour.

The refund order comes after the ERC ordered NGCP to recalculate its ancillary services procurement agreement (ASPA) rates using lower rates approved by the commission.

Ancillary services are necessary to support the reliable transmission of power.

The subject of the refund order is NGCP’s procurement agreement with Therma Marine Inc.

The billing period covered by the order is from February 2010 to March 2012.

In calculating the rates that NGCP should have billed its customers, the ERC said it considered the changes in the economic indices during the period, the changes in fuel cost, and the changes in insurance cost.

NGCP is a privately-owned corporation in charge of operating, maintaining and developing the country’s power transmission network.

It is a joint venture between State Grid Corp. of China and OneTaipan Holdings of Henry Sy Jr., the eldest son of mall magnate Henry Sy.

The company won a 25-year concession to run the country’s transmission assets after it took over the management of the country’s national transmission network in 2008 from the state-owned National Transmission Co.