Philippines: Transco seeks to cover backlog through loan from multilateral lenders

Philippines: Transco seeks to cover backlog through loan from multilateral
lenders

THE NATIONAL TRANSMISSION CORP. (TRANSCO) PLANS TO COVER THE P8-BILLION
BACKLOG TO BE PAID TO RENEWABLE ENERGY DEVELOPERS SYSTEM THROUGH A
ZERO-PERCENT INTEREST P15-20 BILLION LOAN FROM WORLD BANK AND ASIAN
INFRASTRUCTURE INVESTMENT BANK (AIIB).

"We have only made 72 percent in payment so the outstanding is about P8.1
billion as of July 5," Transco compliance monitoring department manager
Dinna Dizon said in the second Philippine Hydro Summit last July 12.

The payment, which is under the Feed-in Tariff (FIT) system, has been billed
a total of P30 billion from 1,107.8 megawatts (MW).

Though the agency has not been remiss in its collections, according to
president Melvin Matibag, the backlog is a result of regulatory lag.

"In fact, Transco has a 99 percent collection efficiency but the problem is
our collections are not enough," he said.

As a solution, Matibag eyes multilateral lenders like AIIB and World Bank to
borrow the backlog, as the two banks are known to have energy funds for
renewable.

"I am talking to the AIIB and World Bank if they can loan us zero interest,
which we will use to pay developers with the commitment na all that all of
our collection in the coming years will be paid back," Matibag said.

"I'm looking at Php15-20 billion including buffer because we're eyeing zero
percent interest. I'm preparing the memo by the end of the month," he added.

The application for load has been acknowledged by Finance Secretary Carlos
Dominguez and approved-in-principle by Energy Secretary Alfonso Cusi.

The increase of the FIT-All rate last month, 18.3 centavos, was aimed to
cover the P6.6 billion to renewable developers under the FIT System.

However, the amount has ballooned to over Php8 billion because "the FIT All
fund has yet to receive collection for the 18.3 centavos per kWh because
this was just implemented starting June billing period," Dizon said.

FIT-All is a uniform charge billed to all on-grid electricity consumers,
reflected as a separate component in their monthly electricity bills paid to
developers.

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Link to Original Article:
http://powerphilippines.com/2017/07/18/transco-seeks-cover-backlog-loan-mult
ilateral-lenders/

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com