ERC computing penalties vs. gencos probed in May 31-June 3 power outages

The Energy Regulatory Commission (ERC) is wrapping up its investigation into 17 power generation companies that supposedly breached the allowable number of unplanned outages, resulting in power outages from May 31 to June 3.

“Today, we are done with about eight that we have finalized the evaluation of the facts and we are now on the last phase of computing the penalties,” ERC chairman Agnes Devanadera told the House Committee on Appropriations on Thursday.

“We’re expecting that we will be able to come out with the final resolution within the next two weeks,” she said.

The ERC did not identify the eight gencos that will be issued final resolutions, but committed to submit the names to the House panel.

Early in June, the ERC issued notices of non-compliance and show cause order to 17 power generation firms to explain the unplanned outages that breached the maximum allowable unplanned outage days per year. 

The ERC issued in November 2020 Resolution No. 10, Series of 2020 entitled “A Resolution Adopting the Interim Reliability Performance Indices and Equivalent Outage Days Per Year of Generating Units.”

The resolution sets forth the maximum or cap for annual unplanned outages per generating plant technology.

The 17 gencos are the following:

• SEM Calaca Power Corp.
• GNPower Mariveles Coal Plant Ltd.
• Masinloc Power Partners Co. Ltd.
• Southwest Luzon Power Generation Corp.
• TeaM Sual Corp.
• SPC Power Corp.
• Panay Power Corp.
• SN Aboitiz Power-Benguet Inc.
• CBK Power Company Ltd.
• SPC Island Power Corp.
• First Natgas Power Corp.
• FGP Corp.
• First Gas Power Corp.
• Power Sector Assets and Liabilities Management Corp.
• Energy Development Corp.
• Hedcor Bukidnon Inc.
• Power Sector Assets and Liabilities Management Corp.

“We went through the process of requiring them to explain and submit their explanation,” Devanadera said.

“In general, most of those explanations dealt on the pandemic-related issues like the inability of the technical people to come in and the delay in the spare parts, and the lockdown,” she added.

The ERC chair said the power industry regulator is resolving the cases on the 17 gencos “one-by-one, not in lump sum.”

“We have not stopped. We are also a little bit affected as much as many of us every now and then are on quarantine,” Devanadera said, explaining why the ERC is taking time to resolve the issue.

The ERC’s probe stemmed from the series of Red and Yellow alerts which plagued the Luzon grid for three straight days—May 31 to June 3—causing rotating power interruptions.

The DOE blamed the “forced or unplanned outages of power plants and the lack of ancillary services owned or operated by the private sector.”

The Energy department said insufficient supply that resulted in the power outages was caused by the unplanned or forced outages of the following generation plants that are owned by the private sector:

• GMEC Coal-fired Power Plant Units 1 and 2 of GNPower Mariveles Energy Center Ltd. Co. (GMEC) / Aboitiz Power (690 MW)
• Calaca Coal-fired power plant Unit 2 of Sem-Calaca Power Corporation (300 MW)
• Pagbilao Coal-fired power plant Unit 2 of TeaM Energy Corporation and Therma Luzon Inc. (382 MW)
• Sual Coal-fired power plant Unit 2 of TeaM Sual Corporation and San Miguel Energy Corporation (647 MW)

The DOE said the extended scheduled maintenance and the derationing of the following plant likewise contributed to the deficiency:

• San Roque Hydroelectric Power Plant Units 1, 2 and 3 of San Roque Power Corporation (435 MW)

The Energy department also said that the National Grid Corporation of the Philippines (NGCP) failed to comply with the required firm ancillary service contracts, which should be 4% of the power demand and could be tapped in case power plants go offline.

With this, the ERC issued notices of non-compliance to 17 power generation firms to explain the unplanned outages that breached the maximum allowable unplanned outage days per year. — BM, GMA News