The National Grid Corporation of the Philippines (NGCP), a privately-owned company, announced on Wednesday, June 16 that it will begin a competitive bidding process for ancillary services requirements in order to help the government meet its objectives 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.
However, the NGCP official emphasized that acquiring reserves through a firm or non-firm arrangements is not the solution for the recurring brownouts or power outages 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.”
The official further said this take or pay arrangement would only lead to higher electricity costs for consumers.
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.