Transco, NGCP head for showdown

(First of two parts)

The state-owned National Transmission Corp. (Transco) and the privately held National Grid Corporation of the Philippines (NGCP) are on a collision course over what the government agency believes is the latter’s decision to allow third parties to use government property without authority.

In particular, Transco wants NGCP to explain why telecommunications giants Globe Telecom Inc. and Smart Communications were given access to the power grid operator’s facilities that remain the property of the national government despite the franchise agreement that gave NGCP the right to operate it.

In late March, Transco’s newly appointed chief, Melvin Matibag, wrote NGCP president and CEO Henry Sy Jr. seeking clarification about supposed “dismantling and de-installation activities” currently being done within the substations of NGCP.

According to Matibag, his office had received reports that the dismantling of telecommunications facilities were being conducted in NGCP’s substations, high voltage towers and high voltage poles. These facilities are supposedly owned by Bell Telecommunications Philippines Inc.—a company which was sold by its former owner, San Miguel Corp., to Globe and Smart in the country’s largest deal in recent years for P70 billion.

Matibag said his office has proof that “more than 10 contractors” were employed to undertake the decommissioning activities in NGCP’s facilities until May 2017 and that all payments to these contractors were guaranteed by Globe and Smart, as evidenced by the signatures of these companies’ officials on the transaction documents.

“We also take note of the installations that were made in several substations as early as 2015, as found out on routine inspections made by Transco personnel,” the official said, adding that the installations consisted of “highly secured” and “fully powered” container vans with backup generators and CCTV cameras in several Luzon substations.

“We would like to make it known that Transco or the government was never made aware of such installations and construction of these facilities,” Matibag said in his letter. “These, despite the fact that all the grounds and locations where these facilities were erected are owned by Transco.”

Matibag—who is a longtime associate of Energy Secretary Alfonso Cusi, dating back to their days as officials of the Manila International Airport Authority during the administration of President Arroyo—then ordered NGCP to answer the government’s findings.

“We are, therefore, giving notice for NGCP to explain and shed light on the erected facilities and make a confirmation of the reported dismantling or decommissioning of the said facilities,” he said.

More ominously, the energy official added: “If true, we demand that NGCP and other entities authorized by NGCP to cease and desist from any activities of de-installation, dismantling or decommissioning of the facilities mentioned to protect the interests of the government.”

Finally, the Transco chief demanded that NGCP’s facilities be opened to its personnel for the conduct of and immediate audit and inspection.

According to industry sources, the Transco’s letter is the first of what is expected to be a broader salvo in an attempt by the Department of Energy and its allied agencies to rein in the power of the the privately run NGCP.

(To be concluded)