National Grid Corporation of the Philippines (NGCP) said Wednesday it will start a competitive bidding process on ancillary services requirement to help meet the objectives of the government and secure the best value for power consumers.
Ancillary services are support services needed to maintain power quality, reliability and security of the grid.
“We want to guarantee the best pricing for AS, especially since this is a pass-on cost to consumers. With an open and public bidding process, we ensure full transparency and comply with internal governance imperative of accountability, which all our stakeholders deserve,” NGCP president and chief executive Anthony Almeda said.
NGCP, however, said buying AS on either firm or non-firm basis is not a solution to the recurring brownouts in the country.
“What we have is a supply and not a distribution problem. For the grid to effectively address imbalances between supply and demand, we need to increase the power capacity of the country to meet rising demand as we start to recover and fully reopen the economy,” Almeda said.
He said the firm contracting being insisted by the Department of Energy “will not result in additional supply, it will only lead to a change in payment terms where all power, used or unused, will have to be shouldered by the public.”
Almeda said this take or pay arrangement would only lead to higher electricity cost for consumers.
Very little progress has been made in developing new energy sources as existing power facilities age and outputs decline, he said.
The annual power consumption in the Philippines is expected to grow by 14.09 percent from pre-pandemic levels in 2019 to 2021, once economic activity catches up and normalizes.
NGCP is a Filipino-led, privately owned company in charge of operating, maintaining and developing the country’s power grid, led by majority shareholders and vice chairman of the board Henry Sy Jr. and co-vice chairman Robert Coyiuto Jr.