MANILA, Philippines ? The Department of Energy wants the National Grid Corporation of the Philippines, the private operator of the country?s electricity superhighway, to invest in the multi-billion peso Leyte-Mindanao Interconnection Project (LMIP).

This move, according to Acting Energy Secretary Jose C. Ibazeta, will help ensure adequate power supply in Mindanao.

?If you are talking about security, they [NGCP] should push through the project,? Ibazeta said. ?We expect NGCP to undertake this project to help avert power shortages in the future.?

He, however, admitted that the cost of the project, upon the approval of the Energy Regulatory Commission (ERC), would be passed on to consumers.

The LMIP ? which was meant to complete the country?s grid loop ? was among the projects considered as ?crucial? by the National Transmission Corp. (Transco) prior to its privatization and the takeover of the NGCP.

It was supposed to be part of President Gloria Macapagal Arroyo?s targets for the local power sector, as this would enable the country to have a so-called national grid, which meant having interconnected grids from Luzon to Mindanao.

This project is also envisioned to jumpstart the wholesale electricity spot market for Mindanao ? which, until now, remains on the pipeline.

The board of Transco approved as early as 2006 the inclusion of the LMIP and was even eyeing to tap traditional financing sources like Japan Bank International Cooperation (JBIC) and Export-Import Bank to fund the grid project.

The Transco board had then decided to even bring down the cost of the LMIP to $275 million, if only to jump-start the project.

The LMIP should have been financed by the Asian Development Bank (ADB), but the Manila-based lender had reportedly struck off the project from its list after the government raised its intention to defer it.

That time, the government was preparing to privatize Transco and had decided instead that the winning concessionaire should be the one to carry out the project.

The interconnection project included a 250 kilovolt high-voltage density cable bipolar link with a total transfer capacity of 500 megawatts (MW), as well as a 455-kilometer long overhead line and 23 km submarine cable. It will start at the Ormoc Converter Station in Leyte and end at the Kirahon Converter station in Northcentral Mindanao via Southern Leyte and Northeastern Mindanao.