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The National Grid Corporation of the Philippines (NGCP) is a privately-owned corporation that was established on January 15, 2009, through RA 9511. It is a consortium of three corporations, namely Monte Oro Grid Resources Corporation, Calaca High Power Corporation, and the State Grid Corporation of China.
As the franchise holder and transmission service provider, it is in charge of operating, maintaining, and developing the country's power grid and its related assets and facilities,[1] controls the supply and demand of power by determining the power mix through the selection of power plants to put online (i.e., to signal power plants to produce power, as power plants will only produce power or feed their power to the transmission grid when directed by NGCP), and updates the daily power situation outlook for Luzon, Visayas, and Mindanao power grids (which can be seen on its Facebook page as well as on the business section of newspapers since March 2011 such as The Philippine Star, Philippine Daily Inquirer, and Manila Bulletin) by determining the available generating capacity, system peak demand, and operating margin (with operating margin is determined by subtracting the available generating capacity and system peak demand, and all of which are in units of MW or megawatts).
As a common carrier, it must provide non-discriminatory access to its transmission system. It is subject to the standards set by the Philippine Grid Code and the Transmission Development Plan.
History
2001–2009
On June 8, 2001, PresidentGloria Macapagal Arroyo signed RA 9136 (Electric Power Industry Reform Act), which introduced market competition in the energy sector and mandated the creation of National Transmission Corporation (TransCo) 18 days after the law was approved on June 26, 2001. TransCo was a unit of another government-owned corporation National Power Corporation (NAPOCOR/NPC), with the latter operated, maintained and owned the country's power grid during that time, before the transfer of the grid to the former on March 2003.[2]
2003–2009: TransCo as power grid operator, privatization of grid operations and maintenance
On December 12, 2007, two consortia bid for a 25-year license to run the Philippine power grid - privatization of the management of TransCo. The consortium of Monte Oro Grid Resources Corp., led by businessman Enrique Razon, comprising the State Grid Corporation of China, and Calaca High Power Corp., won in an auction conducted by the Power Sector Assets and Liabilities Management (PSALM) Corp. as it submitted the highest offer of $3.95 billion, for the right to operate TransCo for 25 years, outbidding San Miguel Energy, a unit of San Miguel Corporation (bid of $3.905 billion), Dutch firm TPG Aurora BV, and Malaysia's TNB Prai Sdn Bhd. Jose Ibazeta, PSALM president and CEO remarked: “We are very happy about the successful turnout of the bidding for TransCo. PSALM handled the privatization of the government’s transmission business with utmost transparency and judiciousness."[3][4][5] This initiated the privatization process for the transmission sector.[6]
On February 28, 2008, its concession agreement with TransCo was executed and became effective. The agreement between NGCP and TransCo was signed by TransCo president Arthur Aguilar, PSALM president Jose Ibazeta, and NGCP directors Walter Brown, Elmer Pedregosa and Du Zhigang.[7][8]
Congress approved bicameral resolution granting franchise to NGCP to manage and operate its transmission facilities nationwide in November 2008.
On December 1, 2008, Gloria Macapagal Arroyo signed the RA 9511 which gives it the franchise to operate and maintain the transmission facilities of TransCo.
On January 15, 2009, NGCP took over the operations and management of the national transmission system from TransCo which officially started the former to operate and maintain the country's power grid and its related assets and facilities and privatized the grid operations and maintenance, with Walter A. Brown as the company's first president.
2009–present
As a result of the privatization of the power grid operations and maintenance with the turnover from TransCo to NGCP on January 15, 2009, former power grid operator TransCo appointed NGCP to act as its Construction Manager (CM) to do the unfinished parts of transmission projects under Projects Under Construction (PUC) as an independent contractor for and on its behalf by acquiring, building and designating parts and components of the ongoing transmission project under PUC on portions that were not yet acquired and designated by TransCo and making revisions on a project under PUC, and projects under PUC that were not initially started by TransCo, in accordance with the requirements of the Concession Agreement between TransCo and NGCP, and makes or plans any new projects through the Transmission Development Plan (TDP).
On March 26, 2010, Roque Corpuz was appointed as the company's second president, replacing Walter A. Brown.[9] Three months later on June 20 of that same year, Henry Sy Jr. became the third NGCP president.[10]
On August 23, 2010, Department of Energy (DOE) issued Department Order DO2010-08-0015 creating a Technical Working Group to audit NGCP system operations.
DOE issued its first Transmission Development Plan as power grid operator which is the 2009 TDP that would provide a guide for NGCP in improving the reliability of the electricity backbone in April 22, 2016. 2009 TDP contains some information made by TransCo, NGCP's predecessor in power grid operations and maintenance, such as the project components that were originally planned to be made on a particular transmission project before some or all components were changed and revisions were made on a project when NGCP is now the power grid operator.
In May 2017, TransCo accused NGCP with violating its concession agreement with the power grid operator by supposedly making too much money from its operations of the country's electricity grid. Executive SecretarySalvador Medialdea pointed out that, if indeed NGCP had violated the terms of its contract by profiting unduly from the operations of the power grid such as allowing telecommunications firms to mount their fiber optic cables on the transmission towers.[11]
On March 7, 2018, Henry Sy Jr. resigned as president and CEO, with Chief Administrative Officer Anthony Almeda named as the company's new president.[12]
On April 5, 2018, Energy Regulatory Commission (ERC) issued Resolution 4 ordering NGCP to procure a third party auditor for the systems operations audit but was never implemented. Shortly after, the Philippine Electricity Market Corporation through its audit committee drafted terms of reference for an independent auditor but NGCP replied that only ERC has regulatory powers over it.
On June 8, 2018, the Department of Information and Communications Technology (DICT), NGCP, and TransCo signed an agreement on Friday for a national broadband plan that will help accelerate internet connectivity nationwide. Under the agreement, the DICT will utilize TransCo’s reserved optical fiber to distribute connectivity from Luzon to Mindanao using the submarine cables that will be laid down by Facebook from the United States to Asia. The agreement plans to expand the internet connectivity in public places for free by building an additional 200,000 access points nationwide by 2022, DICT Officer-In-Charge Eliseo Rio said.[13]
In July 2018, local officials asked NGCP to explain millions of pesos of pass-on costs to customers as a result of damage incurred as a result of typhoons. The Sangguniang Panlalawigan (SP or Provincial Board) of Ilocos Norte, for instance, passed a resolution asking the NGCP management to make a full disclosure of its request to the ERC for provisional approval of the collection of the force majeure pass-through costs from its clients.[citation needed]
On April 11, 2019, Energy Secretary Alfonso Cusi said his agency committed to implement institutional solutions in ensuring sufficient electricity to meet consumers’ needs, in view of thinning power supply that has at times dipped to critical levels. Cusi said “short-term answers are not enough”.
On July 26, 2019, DoE informed NGCP of the appointment of Delloitte Touche Tohmatsu India LLP-Navarro Amper and Co. as a consultant for the pilot audit of transmission facilities but NGCP replied that it cannot accede to the pilot audit as it is not a party between the consultant and the DoE.
On November 26, 2019, SenatorRisa Hontiveros filed a resolution urging Congress to conduct a national security audit on the operations and facilities of NGCP amid recent revelations of foreign access and control over the country’s power transmission system. In proposed Senate Resolution 223, which Hontiveros filed, she also called on the Senate to look into the national security implications of foreign access to NGCP’s power transmission facilities. The need for immediate assessment of NGCP’s system was raised by Energy Secretary Alfonso Cusi on December 3, 2019 as he indicated it is not impossible now to operate the power system remotely from anywhere amid calls to review the 40 percent stake of State Grid Corporation of China.
On May 31, 2021, DoE announced the Luzon grid was experiencing limited power reserves. The following day, according to DoE, a longer period for a red alert status over the Luzon grid was needed due to additional power plant outages.
On June 2, 2021, a lawmaker in the House of Representatives called for a congressional inquiry into the rolling brownouts experienced in Luzon.
On June 10, 2021, Cusi proposed to the Senate to allow the national government to participate in the power sector, particularly in securing reserve capacity for the country. In a Senate hearing, Cusi urged lawmakers to look into allowing the government to engage in limited power generation to augment energy supply requirements when needed. The DoE chief likewise wanted to revert to government the management of ancillary services contract to ensure the reliability of the grid and the following day, he said preventing power outages in the system will require a regulating reserve which is equivalent to four percent of the peak demand plus the capacity of the biggest power plant in the system. The reserve would be ancillary services contracted by the NGCP in preparation for the dry months. NGCP failed to secure 100 percent of firm contracts for ancillary service. Cusi noted the whole issue is not about power crisis but compliance with the terms of the contract that NGCP signed with the government.
On June 14, 2021, President Rodrigo Duterte said in his weekly address: “I hold everyone responsible to comply with regulations. Unreliable power and the recent outages in Luzon pose a serious threat not only to our COVID-19 response measures but also to our economic recovery”, apparently referring to the NGCP concession with the government.
Cebu-Negros-Panay Backbone project
On April 8, 2024, Marcos Jr. inaugurated the 230 kV Cebu-Negros-Panay Backbone project with its simultaneous ceremonial energization at the NGCP Bacolod Substation in Negros Occidental. The Cebu-Negros-Panay Backbone, which includes the Negros-Panay Interconnection Project Line 2, was built in three stages, the last completed on March 27, 2024. It complements the Amlan-Samboan submarine cable, which is connects Cebu and Negros islands. CNP Project Stage 1 added a new 230kV transmission line from Bacolod to Enrique B. Magalona, Negros Occidental, while Stage 2 upgraded the Cebu Substation into 230kV level.[14][15]
Franchise law and concession agreement
Unlike outright sale, the concession agreement allowed the Philippine government to keep ownership of the transmission assets through TransCo, in accordance with Section 8 of Electric Power Industry Reform Act (EPIRA) or Republic Act 9136 which states that no person, company, or entity other than TransCo who shall own any transmission assets and facilities. Its franchise only covers the operations, maintenance, and expansion of the power grid. Assuming it secures a renewal, it has a 50-year concession period from its creation on January 15, 2009 to December 1, 2058. Under its franchise, it has the right to operate and maintain the transmission system and related facilities, and the right of eminent domain necessary to construct, expand, maintain, and operate the transmission system.[16][17][18][19][20]
Acquisition and designation of lands for transmission structures and right-of-way, and construction of power line structures
As stated before, NGCP has a right of eminent domain necessary to construct, expand, maintain, and operate the transmission system under its franchise as it is able to commence and pursue eminent domain proceedings for the purpose of acquiring and designating new lands for the transmission structures and their respective foundations, and right of way (portions of a power line) that are required to carry out its responsibilities using its name which makes NGCP may act as the owner of lands where the structures and their foundations stand, right of way and entirely new structures called as replacement structures that were acquired, designated and built from January 15, 2009 or during the concession period, and once its franchise expires and concession period ends, these will be transferred to TransCo.
Under the NGCP's concession agreement with TransCo, the TransCo name should be used as TransCo's agent if a land where the structures and foundations stand and particular portions of the power line were acquired and designated by TransCo or prior to the turnover of operations and maintenance of the power grid from TransCo to NGCP and start of concession period on January 15, 2009 even before the structures were built.[21] Transmission structures that were already built before January 15, 2009 but the transmission line itself is not yet finished are also counted as TransCo-acquired, designated and built lands, portions of a power line or right of way, and structures. These situations are in accordance with one of the mandates of TransCo which is to handle all existing cases including right-of-way and claims which accrued until January 14, 2009 or before the turnover of operations and maintenance of the grid to NGCP and start of concession period on January 15 of the said year.
Organization
Below is a table listing the board of directors and officials of NGCP.[22] The NGCP organization or board of directors consists of a chairman, two vice-chairmen, and seven directors. The president serves as the head of NGCP.
CEO of Prudential Guarantee and Assurance, Inc., chairman of the Board of PGA Cars, Inc. and PGA Sompo Insurance, Inc., Vice Chairman of First Life Financial Co., Inc., President, Oriental Petroleum and Minerals Corporation, Director, Canon Philippines, Inc., and Director, Universal Robina Corporation
Chairman Emeritus, Philippine Chamber of Commerce and Industry, Inc., President, DongFeng Automotive, Inc., and Member of Board Directors, Philippine Stock Exchange and the Bank of Commerce
Shan shewu
Director
Chief Representative, State Grid Corporation of China (SGCC) Philippine Office
Liu Ming
Director
Deputy Chief Representative, State Grid Corporation of China (SGCC) Philippine Office, former Chief Representative of SGCC Africa Office, and Technical Director of Market Exploration of SGCC Australia Office.
Liu Xinhua
Director
Engineer with a master's degree and one of the topnotchers in the CPA Board Exam of China
Walter A. Brown (January 15, 2009 – March 26, 2010)
Roque Corpuz (March 26–June 20, 2010)
Henry Sy Jr. (June 20, 2010 – March 7, 2018)
Anthony Almeda (March 7, 2018–present)
Voltages and reference codes
NGCP operates various voltages depends on length, power loss, etc. The Luzon Grid operates 69kV (5LI), 138kV (7LI),[23] 230kV (8LI),[24] and 500kV (9LI).[25]Visayas and Mindanao grids operates 69kV (5LI), 138kV (7LI) and 230kV (8LI). The connection between the grids of each island groups of the Philippines has 350kV (0LI). The common voltage in NGCP is 230kV, simplest voltage is 69kV and 138kV and the highest voltage is 500kV EHV (Used on Luzon Grid).
Reference codes are either in the form of a whole number or the structure code "((voltage number)LI(circuit number)(start of transmission line)-(end of transmission line))(structure number)". Various fonts or typefaces have been used on structure numbers and codes, such as Arial (Light and Bold variants) and ITC Avant Garde (same also with NGCP's predecessors in Philippine power grid operations, maintenance, expansion, and management and its related assets and facilities National Power Corporation (NAPOCOR/NPC) from November 1936 to March 1, 2003 and National Transmission Corporation (TransCo) from March 1, 2003 to January 15, 2009).
If the structures were removed from their original location, like in the case of removed steel poles of Hermosa–Duhat–Balintawak transmission line due to various project made on the said power line, they will either be stored at random NGCP substation and later used on other lines or within the substation, or retired completely if unfit for reusing. If the former case occurs, the original reference number, use, and land and facility or structure ownership will be disregarded and the current number, use, and ownership will be counted. Sometimes when reusing on other uses, the removed facilities or structures will then change design to fit with their current use, with their bottom part still have the original number and ownership.
Business scope
Below is a table listing the district numbers and what areas or provinces that each district covers.[26]
Bataan, officially the Province of Bataan, is a province in the Central Luzon region of the Philippines. Its capital is the city of Balanga while Mariveles is the largest town in the province. Occupying the entire Bataan Peninsula on Luzon, Bataan is bordered by the provinces of Zambales and Pampanga to the north. The peninsula faces the South China Sea to the west and Subic Bay to the north-west, and encloses Manila Bay to the east.
The State Grid Corporation of China (SGCC), commonly known as the State Grid, is a Chinese state-owned electric utility corporation. It is the largest utility company in the world. As of March 2024, State Grid is the world's fourth largest company overall by revenue, behind Walmart, Saudi Aramco, and Amazon. In 2022 it was reported as having 871,145 employees, 1.1 billion customers and revenue equivalent to US$460 billion. It is overseen by the State-owned Assets Supervision and Administration Commission of the State Council.
The National Power Corporation is a Philippine government-owned and controlled corporation that is mandated to provide electricity to all rural areas of the Philippines by 2025, to manage water resources for power generation, and to optimize the use of other power generating assets.
HVDC Leyte–Luzon is a high-voltage direct current transmission link in the Philippines between geothermal power plants on the islands of Leyte and Luzon.
Mariveles, officially the Municipality of Mariveles, is a 1st class municipality in the province of Bataan, Philippines. According to the 2020 census, it has a population of 149,879 people.
The North Luzon Expressway (NLEX), signed as E1 of the Philippine expressway network, partially as N160 of the Philippine highway network, and partially as R-8 of the Metro Manila arterial road network, is a controlled-access highway that connects Metro Manila to the provinces of the Central Luzon region in the Philippines. The expressway, which includes the main segment and its various spurs, has a total length of 101.8 kilometers (63.3 mi) and travels from its northern terminus at Santa Ines Interchange to its southern terminus in Balintawak Interchange, which is adjacent to its connection to Skyway, an elevated toll road that connects the NLEX to its counterpart in the south, the South Luzon Expressway. The segment of the expressway between Santa Rita Exit in Guiguinto and the Balintawak Interchange in Quezon City is part of Asian Highway 26 of the Asian highway network. Despite that the name stating the word "North Luzon", the expressway only ends at Santa Ines Exit at Mabalacat, Pampanga which is located in Central Luzon.
SM Investments Corporation (SMIC), also known as SM Group, is a Filipino conglomerate with interests in various sectors, mostly in shopping mall development and management, retail, real estate development, banking, and tourism. Founded by Henry Sy, it has become one of the largest conglomerates in the Philippines, being the country's dominant player in retail with 208 stores nationwide. Of these, 47 are SM Department Stores; 38 are SM Supermarkets; 37 are SM Hypermarkets, and 86 are SaveMore branches.
The Subic–Clark–Tarlac Expressway (SCTEX), signed as E1 and E4 of the Philippine expressway network, is a controlled-access toll expressway in the Central Luzon region of the Philippines. From its northern terminus in Tarlac City to its southern terminus at Tipo in Hermosa, Bataan, the SCTEX serves as one of the main expressways in Luzon. The expressway is also connected to the Central Luzon Link Expressway, North Luzon Expressway, Tarlac–Pangasinan–La Union Expressway, and the Subic Freeport Expressway. The SCTEX is the country's longest expressway at 93.77 kilometers (58.27 mi) until the completion of Toll Road 4 of South Luzon Expressway (SLEX). The Subic–Clark–Tarlac Expressway was constructed to provide a more efficient transport corridor between Subic Bay Freeport, Clark, and the Central Techno Park in Tarlac, foster development on the municipalities served, and connect major infrastructures such as the Subic Seaport and Clark International Airport.
Ambuklao Dam is part of a hydroelectric facility in Baragay Ambuclao, Bokod, Benguet province in the Philippines. With a maximum water storage capacity of 327,170,000 cubic metres (265,240 acre⋅ft), the facility, which is located 36 km (22 mi) from Baguio city, can produce up to 105 megawatts of electricity to the Luzon grid. The main source of water comes from the Agno River, which originates from Mount Data. The dam is located in a conservation area known as the Upper Agno River Basin Resource Reserve.
ITC Holdings Corporation is an American energy company which owns and operates high-voltage electricity transmission networks. Headquartered in Novi, Michigan, ITC has operations in Michigan, Illinois, Iowa, Kansas, Minnesota, Missouri, Oklahoma, and Wisconsin. The company is a wholly-owned subsidiary of Canadian energy company Fortis Inc.
The National Transmission Corporation is a Philippine government-owned and controlled corporation established in June 26, 2001 by the Electric Power Industry Reform Act and a corporate entity wholly owned by the Power Sector Assets and Liabilities Management (PSALM). It is the owner of the country's power grid and its related assets and facilities since March 1, 2003, and also served as operator of the grid from March 2003 until the turnover of the grid's operations and maintenance to the privately owned National Grid Corporation of the Philippines (NGCP) on January 15, 2009.
2009 in the Philippines details events of note that happened in the Philippines in the year 2009.
China is the world's largest consumer of electricity, and its demand is expected to double by the next decade, and triple by 2035. In 2010, 70 percent of the country's electricity generation came from coal-fired power plants, but the Chinese government is investing heavily in renewable energy technologies. As of 2013, 21 percent of China's electricity generation comes from renewable sources. This represents only 9 percent of overall primary energy consumption in the country. China's latest goal is to increase renewable energy to 9.5 percent of overall primary energy use by 2015. To implement China's new clean energy capacity into the national power grid, and to improve the reliability of the country's existing infrastructure, requires significant upgrades and ultimately, a smart grid.
Wind power in the Philippines accounts for a total of 443MW as of 2020 according to the Department of Energy, covering about 1.6% of the country's total installed capacity for both renewable and non-renewable energy sources. When it comes to existing renewable energy sources in the country, wind power has a total share of approximately 5.4%. Despite currently being a small contributor to the country's energy mix, wind power installations have increased from 33MW in 2012-2013 to 337MW in 2014, 427MW in 2015-2018, and 443MW in 2019-2021. Moreover, the Department of Energy's National Renewable Energy Plan (NREP) 2020-2040 aims to commission 2,345MW of total wind power capacity by 2030. There has been a setback, however, as the wind power industry was moderately affected by COVID, particularly in the import of wind turbines. Due to this, several projects such as the Aklan onshore wind project got delayed. To further drive the wind energy sector in the country, an increased demand for renewable energy, greater government commitments, and reduced wind power tariff are needed.
The electricity sector in the Philippines provides electricity through power generation, transmission, and distribution to many parts of the country. The Philippines is divided into three electrical grids, one each for Luzon, the Visayas and Mindanao. As of June 2016, the total installed capacity in the Philippines was 20,055 megawatts (MW), of which 14,348 MW was on the Luzon grid. As of June, 2016, the all-time peak demand on Luzon was 9,726 MW at 2:00 P.M. on May 2, 2016; on Visayas was 1,878 MW at 2:00 P.M. on May 11, 2016; and on Mindanao was 1,593 MW at 1:35 P.M. on June 8, 2016. However, about 12% of Filipinos have no access to electricity. The Philippines is also one of the countries in the world that has a fully functioning electricity market since 2006 called the Philippine Wholesale Electricity Spot Market(WESM) and is operated by an independent market operator.
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The Sucat–Paco–Araneta–Balintawak Transmission Line also known as Muntinlupa–Manila–Doña Imelda–Quezon Transmission Line, and formerly known as Sucat–Araneta–Balintawak Transmission Line from July 2000 to October 2012, is a 230,000 volt, single-circuit, three-part transmission line in Metro Manila, Philippines that connects Sucat and Balintawak substations of National Grid Corporation of the Philippines (NGCP), with line segment termination at NGCP Araneta substation in Quezon City and Manila Electric Company (Meralco) Paco substation in Paco, Manila.
The Dasmariñas – Las Piñas Transmission Line is a 230,000 volt, double-circuit transmission line in Metro Manila and Calabarzon, Philippines that connects Dasmariñas and Las Piñas substations of National Grid Corporation of the Philippines (NGCP).
The Bay–Calamba–Biñan Transmission Line, formerly known as Bay–Biñan Transmission Line, is a 230,000 volt, double-circuit, two-part transmission line in Calabarzon, Philippines that connects Bay and Biñan substations of National Grid Corporation of the Philippines (NGCP).
The Biñan–Muntinlupa Transmission Line is a 230,000 volt, quadruple-circuit transmission line in Laguna and Metro Manila, Philippines that connects Biñan and Muntinlupa substations of National Grid Corporation of the Philippines (NGCP). It is on a one loop line from Biñan to Biñan.
For more details about NGCP's franchise law, EPIRA law, and power grid operator's concession agreement with TransCo, see: thesewebsites and this PDF document.
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