ERC OKs P376 billion revenue for NGCP

MANILA, Philippines —  The Energy Regulatory Commission (ERC) has permitted the National Grid Corp. of the Philippines (NGCP) to collect about P376.4 billion in revenues from 2023 to 2027.

This, however, is below the NGCP’s proposed annual revenue requirement (ARR) of roughly P442.6 billion under its fifth regulatory period (5RP) rate reset.

For 2023, the ERC has directed the grid operator to implement a maximum allowable revenue (MAR) of about P63.4 billion starting Aug. 1, 2023.

Under the 5RP, NGCP’s MAR is also set at P69.1 billion for 2024, P74.3 billion for 2025, P81 billion for 2026 and P88.5 billion for 2027.

The ARR refers to the proposed forecast of revenues needed to cover costs and earn a reasonable return, while MAR represents the maximum amount the regulator allows the utility to collect annually.

As a highly regulated entity, the NGCP undergoes a rate reset process to determine how much it can charge power consumers over a five-year period, unless extended by the ERC.

In settingNGCP’s revenue cap, the ERC said it considered the grid operator’s submissions alongside the comments and positions of intervenors and other stakeholders.