Senators grill NGCP; consumer group calls for reforms in power management

The National Association of Electricity Consumers for Reforms says that before Maharlika funds are invested in the National Grid Corporation of the Philippines, the power firm should first solve problems affecting the industry

CEBU, Philippines – While the Senate energy committee during a hearing on Wednesday, January 10, unraveled the lapses of the National Grid Corporation of the Philippines (NGCP) in dealing with the Western Visayas power outage, a consumer group also heaped the blame on the Energy Regulatory Commission (ERC) and the Department of Energy (DOE).

The National Association of Electricity Consumers for Reforms, Inc. (NASECORE), in a statement sent to Rappler, cited poor regulation and an outdated power infrastructure as the primary causes of the region-wide blackout.

“NASECORE’s president Pete Ilagan faults the ERC’s regulatory failures stemming from its sluggishness in deliberating and approving power supply contracts, which results in bureaucratic logjam that delays critical projects and discourages further investments in the power sector,” said the statement.

The consumer group also cited the DOE’s failure to push the NGCP to finish grid connection projects, leaving the entire island of Panay solely “reliant on geothermal energy from Leyte”.

During the Senate energy committee’s public hearing on Wednesday afternoon, it was revealed that the ERC had delivered show cause orders and penalized the NGCP for the delays of multiple projects.

These delayed projects included three stages of the Cebu-Negros-Panay Transmission Line Project—an interconnection project which would have served as the “backbone” to prevent power blackouts in Panay.

The delays, according to the ERC and NGCP, were due to alleged complications in construction, right-of-way issues, and the acquisition of permits from concerned local government units.

“Kung natapos po sana etong mga projects na eto (If only these projects were completed), the Panay blackout could have been avoided,” National Transmission Corporation (TransCo) President Fortunato Leynes said during the public hearing.

Citing data from the planning offices of Iloilo province and Iloilo City, Senator Win Gatchalian said that the local governments suffered an estimated P5.7 billion in economic losses due to the power outage at the start of the new year.

Trippings and lapses

To recall, a total of six power plants were felled with unscheduled maintenance shutdowns that occurred after the initial tripping of the Panay Energy Development Corporation (PEDC) Unit 1 power plant at around 12 noon on January 2.

According to NGCP, “internal issues” caused the unplanned shutdown of PEDC Unit 1.

Between 12:06 pm to 2:19 pm on January 2, the NGCP saw that the plant’s voltage and frequency outputs were within normal range and required only the normal routine dispatch protocols, which they performed.

Leynes said that NGCP did not issue a significant incident notice regarding the tripping.

“According to the Philippine Grid Code, tripping of a large generating unit whether it resulted in automatic load dropping or manual load dropping, is considered a significant incident,” The TransCo president added.

Robinson Descanzo, chief operating officer of the Independent Electricity Market Operator of the Philippines (IEMOP), said that the notice should have come from the NGCP in order to alert utility companies and prevent a system collapse.

President Ferdinand Marcos Jr. previously weighed in on the issue in a video on January 5, stating that the power corporation failed to resort to manual load dropping during the two-hour window from PEDC Unit 1’s tripping, resulting in a four-day blackout.

Angered by what was presented, Senator Raffy Tulfo, who leads the Senate committee on energy, said during the hearing that there were “enough grounds” to support the revocation of the NGCP’s franchise.

"Here we are again, same problem, same people, and quite possibly the same issues…Hiyang-hiya ako sa mga kabayan natin sa Panay Island," Tulfo said in his opening statement. @rapplerdotcom

— John Sitchon (@TheJohnSitchon) January 10, 2024

‘Solve problems first’

Recently, Maharlika Investment Corporation (MIC) president and CEO Rafael Consing Jr. expressed his support for Speaker Martin Romualdez’s proposition to invest funds into the NGCP.

NASECORE said that before MIC officials invest in NGCP, the power agency should first solve problems affecting the energy industry, starting with the ERC’s bureaucratic structure.

“The ERC’s current structure and processes are inadequate for the fast-paced, complex decisions required in today’s energy landscape,” NASECORE said in its statement.

NASECORE also demanded that the DOE should be more aggressive in developing alternate sources of energy like solar and wind power that would help reduce reliance on traditional energy sources.

Ilagan urged Marcos to consider appointing credible individuals who would prioritize consumer interests over “monopolist utilities” and that there should be an independent investigation by third-party experts who could provide the president with effective solutions to the power crisis.

“Unless these systemic problems are addressed, the investment of the Maharlika Fund would most likely be wasted and that will come at a steep political price to the leadership,” the statement concluded. – Rappler.com