Franchise loss, class suit eyed vs NGCP

HAVE PHONE, WILL CHILL | Young people pass the time at the Megaworld district during the blackout in Iloilo City on Jan. 5, 2024. (Photo from the Iloilo City Mayor’s Office)

MANILA, Philippines — Lawmakers said the National Grid Corp. of the Philippines (NGCP) may lose its franchise and those responsible could face the court soon for the three-day power outages that hit Western Visayas at the start of 2024.

For NGCP’s failure to finish 37 transmission projects for the upgrade of the state power grid, Camarines Sur Rep. Luis Raymund Villafuerte Jr. said on Saturday during the start of the House inquiry it is enough for Congress to consider revoking its franchise.

“The concessionaire’s blunder of this magnitude and its extraordinary ineptitude in finishing vital transmission lines on time as set in its transmission development plan is reason enough for us lawmakers to take a look at recasting its franchise, if not canceling it in favor of a new, more competent system operator,” said Villafuerte, president of the National Unity Party.

Also on Saturday, Sen. Sherwin Gatchalian said officials in the islands of Panay and Negros are thinking of filing a class suit against the NGCP and power firms responsible for the massive blackout.

In a radio interview over DWIZ, Gatchalian, vice chair of the Senate committee on energy, said Iloilo Gov. Arthur Defensor, Jr. has expressed his constituents’ demand to exact payment of damage.

“This means they [consumers of Panay] will be filing a civil case to exact payment from the NGCP; a class suit petition by constituents filed through the provincial government to seek damage,” he said.

P4-B economic losses

Gatchalian reiterated his position that entities responsible for the economic suffering of power consumers should bear a portion the losses, in order for them to feel the impact and make sure the widespread outages do not happen again.

An earlier Inquirer report said power outages from Jan. 2 to Jan. 5 that hit the islands of Panay, Guimaras and parts of Negros Occidental, cost an estimated P4 billion in economic losses.

“My position is that the penalty for such outages caused by negligence should be almost equal to the amount of losses suffered by a community—if not entirely, a portion of the total amount so that they will be compelled to take responsibility and will feel the financial burden,” he said.

Gatchalian lamented the NGCP did not seem to learn from previous lapses because it was only slapped with a maximum of P10 million in fines.

“This (fine) is a pittance when compared to the billions NGCP is earning in profits,” he said.

He also called on the Energy Regulatory Commission (ERC) to deepen its investigation by finding out who was the most responsible person in the NGCP.“I have heard from the hearings in the House that the person in charge was absent,” he said, adding the ERC also needs to look into the soundness of NGCP’s personnel deployment during the holiday season.

“Because it happened to me when I was still mayor of Valenzuela that on Jan. 2, many of our city employees were absent because they were still in vacation mode, many were hung over,” he said.

Up to 7-year delay

In a statement on Saturday, Villafuerte cited the Department of Energy’s 2023 report, which showed that the NGCP failed to finish on time a total of 37 transmission projects, of which 26 are uncompleted and three have yet to begin construction.

The NGCP’s ongoing transmission line expansions have been delayed, from the shorter period of 21 days to the longest delay of 2,561 days or about seven years, the DOE said.

The unfinished projects included the 230-kilovolt Cebu-Negros-Panay Stage 3 backbone project for the strengthening of the Panay grid, which the NGCP promised to finish by August last year.