PAYBACK TIME: NGCP franchise under threat amid massive Panay blackout

By Rjay Zuriaga Castor

The Senate committee on energy is proposing the revocation of the franchise of the National Grid Corporation (NGCP) amid its supposed “incompetence” in handling the 4-day power outage that plunged Panay Island into darkness in the first week of January this year.

“I am asking the support of my colleagues here sa Senate and even sa Congress. Marami ng grounds for the termination of the franchise of NGCP and ang dami na nilang kapalpakang ginawa,” said Senate committee on energy chairman Raffy Tulfo during their inquiry on Wednesday, January 10.

Tulfo emphasized that the recurrence of a power outage in Panay within a year highlighted the NGCP’s failure to fulfill its role to operate, maintain, and develop the country’s state-owned power grid.

“Enough is enough. How many more provinces will lose by the billions dahil sa kapalpakan ng NGCP? Dapat talaga tanggalan na ng prangkisa itong NGCP ng sa gayon ay hindi na makapang perwisyo and that’s the direction we are going to,” he said.

NGCP maintained its stance that the transmission in the grid from 12:06 p.m. on January 2 to 2:19 p.m., was “stable” and “normal.”

“Since stable nga po ang grid, normal ang voltage at frequency within the required limits. Wala pong overloaded line, walang tripping ng lines, normal po. We did the normal dispatch, normal process, normal responsibility as a system operator,” said Clark N. Agustin, OIC-Central Grid Operations Manager of the NGCP.

Despite this, Tulfo argued that NGCP should have taken maintenance measures after detecting a tripping incident at the Panay Energy Development Corporation (PEDC) Unit 1.

“Within normal range yung 2-hour window period dahil wala kayong ginawang aksyon nagkaroon ng domino effect, after the PEDC Unit 1 tripped hanggang sa naapektuhan yung ibang power plants,” he said.

Tulfo, along with Senator Grace Poe, proposed transferring control of the power grid back to the government through the National Transmission Corporation (TransCo), the owner of the country’s power transmission assets.

This is not the first time Tulfo pushed for the termination of NGCP’s franchise after the latter’s supposed strings of violations during the April 2023 blackout in Panay.

In May 2023, the state-run energy firm also expressed its readiness to manage the operation of power transmission lines in the country if the franchise of the National Grid Corporation of the Philippines is revoked.

The NGCP took over transmission operations of the country’s power transmission grid in 2009. It carries a 25-year concession and a 50-year congressional franchise to manage and expand the grid.

NGCP is 60 percent owned by a group of Filipino businessmen led by tycoons Henry Sy Jr. and Robert Coyiuto Jr, while the remaining 40 percent is owned by the State Grid Corporation of China.

Meanwhile, Senator Sherwin Gatchalian emphasized that if the power crisis will not be resolved soon it will likely happen again, especially with the impending stronger effects of the El Nino phenomenon.

“I join our colleagues in looking for the truth; it’s important not to repeat this occurrence again. […] We have El Nino in our midst, and if we don’t find a solution and we don’t hold actors to account, this might become a real and dangerous problem when the summer comes in,” he said.

He added that those responsible should be held to account to prevent another repeat of the incident.

Senator Francis Tolentino expressed his willingness to craft a measure that would amend Republic Act (RA) 9511, the law granting NGCP’s franchise.

He noted that Congress can amend the franchise as stipulated under section 2 of RA 9511.

“[It] is hereby granted under the condition that (the franchise) shall be subject to amendment, alteration, or repeal by Congress when the common good so requires,” it read.

“NGCP’s failure to immediately acknowledge their shortcomings in managing the Panay power outage further erodes trust and raises concerns about their commitment to transparency in addressing system issues within their operations,” Tolentino said.

For Senator Risa Hontiveros, it’s high time that the legislative franchise of the NGCP is reviewed after the massive power outage that hit Panay again in less than a year.

Hontiveros asked the Senate to look into the NGCP’s franchise should the country’s power grid operator be proven negligent and incompetent.

“It is time for the dysfunctional cycle of unending blackouts and expensive power costs to end,”  she said.

SOMEONE HAS TO PAY

Iloilo City Mayor Jerry Treñas said the inquiry on the power outage should put a name on who will be made accountable for the massive power outage that recently hit Panay Island.

“We are angry to hold those who are accountable. You must pay for these, otherwise we go on with this inquiry, nothing will happen […] I am also waiting that after this inquiry, we will see who is accountable and those who are accountable should be made to pay. We are serious this time,” he said.

He further dared: “This time, find someone who is guilty and hold them accountable and let them pay.”

He referenced a similar situation in April 2023, where he claimed that no one was held responsible.

“Unfortunately, some of our friends in the legislature were trying to help defend those who are guilty. This time, we will not allow those people who are responsible to get away with this,” he said.

Meanwhile, Iloilo Governor Arthur Defensor Jr. pushed for two solutions to address the power crisis in Panay.

“The NGCP and others concerned should perfect the management of the national grid because there is no room for mistake here,” he said,

Defensor also highlighted the significance of completing vital infrastructure projects, such as phase 3 of the Cebu-Negros-Panay (CNP) backbone project and other ancillary structures to strengthen the grid and prevent future blackouts.

The governor pointed out that NGCP transmission lines in the Panay grid should be able to withstand trips, disturbances, and anomalies, underscoring that a grid without a backbone is weak.

“A grid without a backbone is not a national grid. A national grid with an unfinished backbone is a weak national grid. If we don’t address these matters, the blackout will happen again,” he added.

The governor also disclosed that he will, alongside several local chief executives, pursue legal action to vindicate the rights of those affected and seek compensation for the damage caused.

He stressed the urgency of finding an immediate solution to prevent a recurrence of the blackout, emphasizing the significant economic losses incurred by the province and the city.

“More importantly, we would like to exert the strongest pressure so that the blackout will not happen again […] We are here to plead for an immediate solution to the problem,” he said.

The power outage caused the city to lose P2 billion in its economy, while the province is estimated to have suffered a total of P3.737 billion in economic losses.