The National Grid Corporation of the Philippines (NGCP) said the increase in transmission charges which pushed power prices in Metro Manila this month was driven by the resumption of the Ancillary Service (AS) Reserve Market (AS-RM).
NGCP said in a statement yesterday transmission wheeling rates, or what the company charges for its primary service of delivering power, has gone down by 5.5 percent from P0.5038 per kilowatt hour (kWh) in July 2024 to P0.4761 per kWh in August 2024.
However, AS rates for the August 2024 billing period increased by 125.92 percent with P0.6127 per kWh compared to P0.2712 per kWh in July 2024, NGCP said.
AS serve as the available generating capacity for dispatch to meet contingency reserve requirements when a power generating unit trips or a transmission interconnection problem occurs.
NGCP said the AS rate is the cost sourced from the AS-RM which resumed last August and does not include the settlement of the remaining 70 percent AS cost for the March 2024 billing period prior to its temporary suspension of collection.
Last May, the Energy Regulatory Commission (ERC) ordered the partial lifting of the suspension on settlement amounts in the AS-RM and approved the 30 percent partial settlement for March 2024 billing period.
“NGCP clarifies that while consumers may notice an increase in transmission charges, this is a result of the resumption of the AS Reserve Market,” the company emphasized.
NGCP said in compliance with directives from the Department of Energy and the ERC, it contracts 50 percent of its AS requirement from firm agreements and 50 percent from the AS-RM.
The AS cost is a pass-through cost paid to generating companies.
