<\/p>\n
THE Energy Regulatory Commission (ERC) raised the revenue ceiling for the National Grid Corp. of the Philippines (NGCP) to P380.45 billion through 2027 after approving a better regulated return on capital for the country\u2019s transmission operator.<\/p>\n
In an order dated May 15, the regulator modified portions of its Jan. 29 decision and granted parts of NGCP\u2019s motion for reconsideration under the fifth regulatory period (5RP) rate reset covering 2023 to 2027.<\/p>\n
The revised ruling increased NGCP\u2019s maximum allowable revenue (MAR) by P4.04 billion to P380.45 billion from the previously approved P376.42 billion. The ERC also raised the grid operator\u2019s adjusted annual revenue requirement (ARR) to P378.71 billion from P374.98 billion.<\/span><\/p>\n The adjustment followed the ERC\u2019s recalibration of the weighted average cost of capital (WACC) to 11.92% from 11.74%. The WACC serves because the benchmark utilized by regulators to find out the return a utility may earn on its investments.<\/p>\n \u201cThis WACC is meant to ascertain a good and reasonable opportunity for NGCP to get well its efficient costs of capital contemporaneously with the RP (regulatory period) to which the rates must apply,\u201d the ERC said in its order.<\/p>\n NGCP operates, maintains, and develops the country\u2019s state-owned power grid under a 50-year franchise granted by Congress. The corporate began operations in 2009 after taking on transmission functions and related facilities nationwide.<\/p>\n The transmission network delivers electricity from power generators to distribution utilities and directly connected customers through an interconnected system spanning greater than 21,000 circuit kilometers of transmission lines, about 20,000 transmission towers, and 140 substations across Luzon, Visayas, and Mindanao.<\/p>\n Based on company data, the Luzon grid accounts for about 74% of the country\u2019s total electricity demand, while the Visayas and Mindanao grids represent 14% and 12%, respectively.<\/p>\n Under its franchise, NGCP is permitted to operate and maintain transmission facilities and undertake the development and expansion of transmission infrastructure, including the exercise of eminent domain when mandatory for transmission projects.<\/span><\/p>\n As a regulated public utility, NGCP\u2019s recoverable revenues and allowable returns are subject to periodic ERC rate reset exercises conducted every five years. Under the method, regulated entities submit forecast expenditures, operating costs, and proposed capital projects for evaluation.<\/p>\n The ERC then determines the MAR, or the utmost revenue NGCP may get well from consumers for transmission services, and the ARR, or the quantity needed to cover operating and capital-related expenses in the course of the regulatory period.<\/p>\n The regulator also moved the implementation of the 2023 MAR adjustments to October 2026 from the sooner August 2026 schedule to align with NGCP\u2019s billing cycle. \u2014 Sheldeen Joy Talavera<\/b><\/span><\/p>\n<\/p><\/div>\n <\/p>\n","protected":false},"excerpt":{"rendered":" PHILIPPINE STAR\/ MICHAEL VARCAS THE Energy Regulatory Commission (ERC) raised the revenue ceiling for the National Grid Corp. of the Philippines (NGCP) to P380.45 billion through 2027 after approving a better regulated return on capital for the country\u2019s transmission operator. In an order dated May 15, the regulator modified portions of its Jan. 29 decision […]<\/p>\n","protected":false},"author":1,"featured_media":336511,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[678,18099,20480,51846,3513,138],"class_list":["post-336510","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-cap","tag-erc","tag-ngcp","tag-p380b","tag-raises","tag-revenue"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/posts\/336510","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/comments?post=336510"}],"version-history":[{"count":2,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/posts\/336510\/revisions"}],"predecessor-version":[{"id":336513,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/posts\/336510\/revisions\/336513"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/media\/336511"}],"wp:attachment":[{"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/media?parent=336510"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/categories?post=336510"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/tags?post=336510"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}