NPC asks ERC to raise rates as fuel fund gets depleted

By Alena Mae S. Flores – June 5, 2024, 7:25 pm
from manilastandard.net

State-run National Power Corp. (NPC) warned it would need additional funding for its fuel requirements next year, which can be addressed by its proposed new subsidized approved generation rates (SAGR) to be paid by consumers in off-grid areas.

NPC president Fernando Martin Roxas said hearings with the Energy Regulatory Commission are ongoing for its SAGR application.

“Our rate is designed at P36 per liter. What we are paying now is P68 per liter, plus hauling from depot to the islands, so that’s additional P6 to P7. We are only recovering less than a third of our cost, so we are losing a lot of money,” Roxas said.

He said NPC resolved its fuel supply issue with a P15-billion loan last year.

“We are using that money to make sure that fuel gets paid. Unfortunately, just for this year alone, we will need an increase of about P0.08 per kwh or else, our borrowings will be wiped out,” Roxas said.

He said the P0.08 per kWh “is what is required for NPC to be able to buy all of the fuel needed to supply all the islands until December.”

He said the funds would run out by December, “so we need some kind of approval we will have P8 billion for next year.”

The ERC has been conducting a series of public hearings across the country on the NPC’s proposed SAGR.

NPC performs the missionary electrification function through the NPC-SPUG and provides power generation to areas that are not connected to the grid as mandated by the Republic Act No. 9136, or the Electric Power Industry Reform Act of 2001 (EPIRA).

The SPUG plays a crucial role in providing basic and reliable power services to rural residents and community facilities in far-flung and unviable areas.