The government and the private sector are preparing for the eventual inclusion of Mindanao and several Visayan grids to the wholesale spot market.
The Philippine Electricity Market Corp. (PEMC) and the National Grid Corporation of the Philippines (NGCP) will start training of IT personnel and trial operations for several power players.
NGCP said it will ensure that transmission and metering facilities will be available in the region.
The power industry is preparing for the Mindanao grid’s inclusion in wholesale spot market, after the NGCP announced that it has found a feasible route to connect the Visayas and Mindanao grids.
The spot market will help users choose the cheapest available power and at the same time allow producers to sell their extra supply.
Earlier this month, NGCP said the project that would finally unify the country’s three power grids will likely cost P52 billion and will be completed by December 2020. This is bound to be the biggest project of the company.
It said based on a hydrographic survey conducted from September to November 2016 that it commissioned, the viable route may run along the country’s western seaboard beginning in Cebu and ending in Dipolog. This route spans 306 kilometers of cables: 112 km from the Visayas side, 92 km submerged underwater and 102 km from the Mindanao side.
“Next step is to update our systems simulations and cost estimations. We need to complete that before we can submit it to the ERC (Energy Regulatory Commission), before we can implement the project. But while these things are ongoing, preparatory works will be started already,” RediRemoroza, NGCP head of transmission planning department, saidrecently.
He added the company will start securing environmental permits and acquiring right-of-way this year so construction can begin next year. NGCP is currently completing the documents for its application to the ERC thisApril.
The company said the project will be funded by a mix of internally generated cash and equity which will later be decided by the ERC on its recovery structure.
However, Alcantara-ledAlsons Consolidated Resources Inc. (ACR) earlier said the oversupply of power in Mindanao will only be short lived as supply and demand is only suppressed at the moment.
“Historically, the growth of demand in Mindanao has been about three percent per annum which is also accompanied by suppressed supply and therefore suppressed demands… Fast growth is possible and there’s a saying that if you build them, they will come. We think there will be an oversupply but it will probably be short lived,” Tirso Santillan Jr., ACR executive vice president, had said.
Santillan added the oversupply will only last for approximately three years as the average three percent increase in the peak load will balloon up to 12 percent.