NGCP: Power consumers pay only 4% for transmission charge on latest bill

MANILA, Philippines — The National Grid Corp. of the Philippines (NGCP), the country’s private transmission operator, said utility customers pay only four centavos for every peso spent on their monthly electricity bill.

In a statement, NGCP said based on the May 2020 electricity billing by distribution utility (DU) from the April 2020 transmission charge, the rate was only P0.04 for every peso spent on electricity, representing 3.93 percent of the total electricity for the month.

Transmission charge is the cost of delivering and balancing high-voltage electricity from the generators to the distribution utilities.

NGCP also specified that ancillary services (AS) charge, on the other hand, only accounts only for 4.10 percent. NGCP collects the AS but remit them directly to the AS provider.

NGCP also pointed out that the share of generation charge or the fraction paid to power plant owners and operators has the lion’s share of 44.03 percent; while distribution charge represents 33.49 percent; and others like government taxes would take up the remaining 14.45 percent.

NGCP’s pass-on transmission charge continues on a downtrend with a record low of P0.51 per kilowatt-hour (kwh) as of 2019.

The transmission charge has been consistently declining when compared with the P0.69/kwh charged by the National Transmission Corp. (TransCo) prior to the privatization of the transmission assets in 2009.

NGCP is the private entity that won the 25-year contract to manage, operate, expand and improve the country’s power transmission system in a privatization exercise carried out by state-run Power Sector Assets and Liabilities Management Corporation (PSALM) in 2009.

When NGCP assumed the management of the country’s transmission facilities in 2009, TransCo’s rate in 2008 was at P0.69/kwh.

There was an initial seesaw on the transmission tariff upon NGCP’s assumption until successive reductions came in recent years as NGCP brought it down further to P0.51/kwh as of 2019.