Aboitiz group to supply NGCP with standby power

MANILA, Philippines—Aboitiz Power Corp. said Friday three of its affiliates have agreed to supply the National Grid Corp. of the Philippines with ancillary services — standby power supply that can be tapped in case the regular supply falls short of the requirement—to help ensure the “integrity” of the main power grid.

The procurement of ancillary services by NGCP was said to be crucial as these capacities were needed to maintain a stable and reliable operation of the interconnected transmission system.

In a disclosure to the Philippine Stock Exchange yesterday, APC said it was informed by SN Aboitiz Power-Magat Inc. (SNAP-Magat), and SN Aboitiz Power-Benguet Inc. (SNAP-Benguet) that they have signed Ancillary Services Procurement Agreements (ASPAs) with the NGCP for the provision of regulating and contingency reserves from their respective facilities.

SNAP-Magat owns and operates the 360-megawatt Magat hydroelectric power plant located at the border of Ramon, Isabela and Alfonso Lista, Ifugao, while SNAP -Benguet owns and operates the 225-MW Ambuklao and Binga hydroelectric power plants located at Bokod and Itogon in Benguet.

“The ASPAs cover firm contracted capacities for both regulating and contingency reserves at 155 MW for Magat and 95 MW for Ambuklao. The ASPAs are valid for three years from the issuance of a provisional or final approval by the Energy Regulatory Commission,” APC said.

Another affiliate, Therma Luzon, Inc. (TLI), also signed a similar agreement with the NGCP covering both firm and non-firm contracted capacities for contingency reserve at 60 MW during off-peak and 60 MW during peak hours. This particular agreement is valid for a period of five years from the date of approval by the ERC.

The NGCP, operator of the country’s electricity superhighway, earlier said it was targeting to bring down the cost of ancillary services by as much as 40 percent in order to ease the burden of high electricity prices on consumers.

It noted that the rates under the new agreements filed with the ERC were “significantly lower and cheaper” than the current agreements. “The new contracting methodology, rates, and payment structure to be applied on all prospective ASPAs are designed to lower the overall cost of ancillary services by as much as 40 percent, and at the same time ensure the availability of ancillary services capacity for the reliability and security of the grid,” the NGCP explained earlier.