The National Grid Corporation of the Philippines (NGCP) is earmarking P440 billion for capital expenditures (capex) from 2021 to 2033, as it intends to invest in 211 vital transmission projects across the country.
In a preliminary prospectus filed by Synergy Grid and Development Philippines Inc., which owns 60 percent of NGCP, the grid operator said it is committed to invest in the nationwide transmission network to drive future growth.
“For the 13-year period between 2021 and 2033, NGCP has committed to invest approximately P440 billion in capital expenditures across 211 projects. The Group expects that NGCP’s robust project pipeline and the Mindanao-Visayas Interconnection Project (MVIP), which is a landmark project, to continue to expand its regulatory asset base,” it said.
The MVIP is expected to be completed within the first quarter of next year. It was certified as an Energy Project of National Significance in 2018 and was initially targeted for completion by December 2020 but was extended to December 2021 due to the Covid-19 pandemic and subsequent quarantine restrictions across the country.
Upon completion, the MVIP will connect the Visayas and Mindanao grids through a high voltage direct current (HVDC) system with a 450-MegaWatt (MW) initial capacity. The project covers 184 circuit kilometers (ckm) of submarine cables and 526 ckm of overhead wires connecting Dapitan, Zamboanga del Norte to Santander, Cebu.
In the same document, NGCP indicated that it will develop a unified national grid and continuously implement new high-voltage transmission backbone to expand the network and accommodate the needed generation capacity additions.
“The Group believes that one example of NGCP’s outstanding execution capability is the Mindanao-Visayas Interconnection Project, where NGCP targets to establish two cable terminal stations, two converter stations and 712 CKM of transmission lines in total, aimed at building ONE Grid Philippines,” it said.
As contained in the Transmission Development Plan 2021-2040, NGCP is tasked to implement the stage-by-stage grid looping configurations for resiliency and reliability, implement additional submarine cable links between islands to allow power exchange, and implement new substations and capacity expansion of existing substations to ensure the adequacy and reliability of supply.
NGCP holds the 25-year concession agreement to operate all the transmission and sub-transmission assets in the Philippines. It derives bulk of its revenues from regulated activities.
“In operating its core transmission business, NGCP seeks to preserve an efficient, conservative capital structure and intends to continue to invest in the core regulated business in order to maintain a stable, consistent and profitable business profile and enable the Group to finance capital expenditures and pay dividends,” it said.
Synergy Grid exercises control over 60 percent of the outstanding capital stock of NGCP through its subsidiaries, OneTaipan Holdings, Inc. and Pacifica21 Holdings, Inc.
OneTaipan of Henry Sy Jr. indirectly holds an equity interest of 30 percent plus one share in NGCP through its wholly-owned company, Monte Oro Grid Resources Corp. while Pacifica21 of Robert Coyiuto Jr. indirectly holds an equity interest of 30 percent minus one share in NGCP through its wholly-owned company, Calaca High Power Corp.
