The NGCP compound on Araneta Avenue in Quezon City. (File photo by LYN RILLON / Philippine Daily Inquirer)
MANILA, Philippines — The Senate public services committee on Monday assured the public that it would “thoroughly scrutinize” the operations of the National Grid Corp. of the Philippines (NGCP) after Sen. JV Ejercito moved to pull the plug on China’s role in the country’s power transmission business.
“[We are] open to the review of the congressional franchise of [NGCP] as it concerns a critical need of Filipinos,” Sen. Grace Poe, who chairs the committee, told the Inquirer.
“The committee will see if it has remained faithful to its signed franchise or if violations have been committed,” she said, adding that the power interruptions that several areas in Luzon experienced the past several weeks “should not be the norm.”
Ejercito’s proposal for the government to take back control of the energy grid system also received the support of his colleagues, among them Sen. Risa Hontiveros, who had previously called for a security audit of NGCP.
On Sunday, Ejercito claimed that while the State Grid Corp. of China (SGCC) owned only 40 percent of NGCP, its Chinese officials had actual control of its operations.
The controlling 60-percent share in the transmission operator belonged to a group of Filipino businessmen led by tycoons Henry Sy Jr. and Robert Coyiuto Jr.
For her part, Hontiveros reiterated that the government should not have transferred the operation of the transmission lines to a private entity.
Besides jeopardizing the country’s national security, she said it also resulted in “financial losses” for the government.
Inconvenience, losses
“As a result, I wholeheartedly support (Ejercito’s) proposal to reclaim control of the national grid, particularly from Chinese control,” Hontiveros said.
Senate Majority Leader Joel Villanueva said Ejercito’s suggestion “makes a lot of sense.”
Meanwhile, Sen. Sherwin Gatchalian, vice chair of the Senate energy committee, sought an investigation into the power interruptions and NGCP’s failure to finish its transmission projects on time.
“These successive transmission system disturbances caused inconvenience to communities and losses to businesses,” Gatchalian said, and “(NGCP), as the operator of the transmission system in the country, should be held to account for the root cause of these disturbances.”
Sen. Francis Escudero, however, differed with his fellow senators, pointing out that it would be costly for the government to ease out SGCC from NGCP.
“I don’t support it, not until I read (the) fine print (of Ejercito’s proposal) and subject it to a thorough study,” Escudero said.
Performance audit
He said the government should be “very careful” and “more circumspect” in reacquiring state assets that had already been privatized.
“Does anyone honestly think that the government can run NGCP better than the private sector?” Escudero asked.
In the Lower House, Albay Rep. Joey Salceda, the ways and means panel chair, on Monday urged the Energy Regulatory Commission (ERC) to conduct a performance audit of NGCP by August this year upon completion of its major projects.
“NGCP is supposed to complete the Bataan-Hermosa line, the Cebu-Negros-Panay connection, and the Mindanao-Visayas interconnection by August 2023. I strongly urge an audit by the ERC by then. If not, we in Congress will do it. But ERC audit is more direct, because there is a very explicit provision in the NGCP franchise that they can use to act on audit findings,” he said.
Salceda pointed out that the ERC should exercise its powers under Republic Act No. 9511, or NGCP’s franchise, and require the company to have “performance improvements” amid the blackouts.
In a statement, the lawmaker said Congress had “given NGCP a lot of privileges on the promise of good performance.”
“It has earned between 39 [and] 52 percent in net profit since it started operating in 2009. Meanwhile, at any given year, capital expenditures and concession fee payments have only reached 38 percent of revenues. Once the concession fee is fully paid in 2029, you will see them make even bigger profits,” Salceda noted.
“And yet you have incidents like the Bolo-Masinloc 230 kilovolt (kV) Line 2 tripping last week, causing the grid to lose some 1,350 MW in power,” he said.
He said he would push to amend NGCP’s franchise “if a performance audit finds that the NGCP has not met its obligations and has itself to blame.”