Damage cost on transmission facilities may drive up power rates

by Myrna Velasco – January 8, 2016

from Manila Bulletin

The series of bombings targeting transmission facilities that can result in massive damage may eventually drive electricity costs higher, the Department of Energy (DOE) has warned.

It stressed that the toppled facilities will typically necessitate either repair or replacement that would entail additional investments – which in turn would be recoverable from consumers via pass-on in the electric bills.

Energy Secretary Zenaida Y. Monsada has issued a stern reminder to the public that “damage to transmission facilities may eventually be part of the transmission recovery cost.”

No calculation has been provided by NGCP yet as to the extent of damage wrought on its transmission assets. The bombing incidents escalated during the Christmas holidays.

Such costs may eventually be classified as “force majeure events” of which corresponding costs could be recouped in the bills with the approval of the Energy Regulatory Commission.

Given the unabated strike against the transmission towers of the National Grid of the Philippines (NGCP) in Mindanao grid, the energy department is intensifying its call for public vigilance “to report suspicious activities in critical areas.”

The transmission firm has already warned of probable grid collapse if the unscrupulous elements would continue with their terroristic activities.

Compounding the company’s dilemma had been the un-cooperative stance of landowners by blocking them in their properties when NGCP needed to undertake repair of the damaged facilities.

Until this time, the government is still clueless how this worsening problem could be resolved – despite call for collaboration of various agencies of government, the law enforcers and local government units, to thresh out some matters that could end such atrocities on vital energy facilities.

Monsada further pleaded to the local government units (LGUs) and landowners “to cooperate with NGCP…in securing the transmission system which is crucial to bringing electricity to the people of Mindanao.”

The energy department has reported that 15 towers had been bombed, and although 14 had already been restored, the most crucial one – the Agus 2-Kibawe line – which underpins the wheeling of electricity from one of the Agus plants “is yet to be repaired” due to reported unsettled concerns with the landowners.