NPC addresses rise in power demand in missionary areas

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SAN FERNANDO CITY, La Union  – The growth of business and economic activities in the missionary areas has prompted the National Power Corporation (Napocor) to augment its P17.302 billion budget for 2015 with another P1.062 billion or an additional 6% that will come from its internally cash generated funds.

Owing to its continued good financial standing in 2014, Napocor had a P1.5 billion net income – the highest since its financial turnaround in 2012, to fund additional budget requirement for the New Power Providers (NPPs) and Qualified Third Parties (QTPs). NPPs and QTPs are private power suppliers that have taken over the generation function of Napocor in missionary areas.

Due to a projected hike in the demand for electricity in missionary areas, an increase in subsidy payments to private power suppliers has also been forecasted, thus the need for augmentation in Napocor’s budget for NPPs and QTPs.

For 2015, the NPPs and QTPs updated energy sales is projected at 604 GWh, representing an 18% increase from its original forecast for the year of 511 GWh.

“The increase in demand is mainly because of the upsurge of economic activities and the improved living standards in the islands after boosting electric supply in new growth areas in Palawan, Mindoro, Catanduanes, Masbate, and Siquijor,” said Napocor President and CEO Ma. Gladys Cruz-Sta. Rita.

Specifically, the proposed augmentation of P1.062 B shall address the full-year requirement for the subsidy expenses of NPPs and QTPs operating in missionary areas. This includes P944 million augmentation budget intended for the October to December 2015 requirements for existing NPPs and QTPs and the realignment of P118 million budget to cover the requirements of additional NPPs, which recently received approval to operate from the Energy Regulatory Commission (ERC).

The NPPs and QTPs operating in missionary areas are the Palawan Power Gen, Inc. (PPGI), Delta P, Inc.; DMCI-Masbate; Ormin Power, Inc.; Power One; Mindoro Grid; Catanduanes Power Generation, Inc. (CPGI); Power Source Philippines, Inc. (PSPI); DMCI-Palawan; Bantayan Island Power Corporation (BIPCOR); Siquijor Island Power Corporation (SIPCOR); and Calamian Island Power Corporation. Meanwhile, the new NPPs that started operation earlier in 2015 are Sunwest Water and Electric Company (SUWECO) in Catanduanes and DMCI-Calapan in Mindoro. However, instead of subsidy SUWECO joins fellow renewable energy plants, the Catingas Mini Hydro in Sibuyan Romblon and the Linao Cawayan Mini Hydro Power Plant in Mindoro in availing cash incentives.

Introduced by the Department of Energy (DOE) in 2004, the government’s Private Sector Participation (PSP) Program in the missionary areas has already attracted a total of 16 private power suppliers in the off-grid areas. The program’s main purpose is to accelerate the total electrification of the country and encourage the inflow of private capital in missionary electrification.

Moreover, the Small Power Utilities Group (SPUG), implementing arm of Napocor in providing electricity in missionary areas that are not yet taken over by NPPs and QTPs also has a forecasted increase in demand from 399 GWh in 2014 to 448 GWh in 2015. This is due to the extension of service hours of some power plants and the electrification of new areas. Napocor has identified a total of 1,130 missionary areas (sitios and barangays) that are yet to be energized.

Napocor has recently extended the operating hours of some 53 SPUG plants and put into full 24 hours of operation its plants in the Municipalities of Culion, Taytay, El NIdo and San Vicente in Palawan and Caluya in Antique. By Dexter A. See

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