Independent power producer Delta P, during Wednesday’s Senate hearing, committed to finding a way to keep its power plants running to supply electricity to the Palawan grid despite its financial difficulties.
Delta P senior vice president for regulatory and industry affairs, Joseph Lua, said in a senate hearing on energy that they are trying to get a credit line to acquire fuel for their generators and thus avert an earlier plan to stop operations by the end of September.
“We’ve been there sa Puerto Princesa for the longest time. We are exerting our effort to stretch our cashflows to provide an extension to this problem. Hopefully, makakuha kami ng another credit line para sa fuel to extend and wait for the payment of NPC,” Lua told senators.
Delta P also made its commitment during a meeting called by the Department of Energy (DOE) and National Electrification Administration (NEA) on Tuesday with stakeholders and national power providers (NPP).
Lua stated that they have a pending billing of around P500 million to the National Power Corporation (NAPOCOR) representing the government’s subsidy for island grids or Universal Charge for Missionary Electrification (UCME). He said that from March 22 to August 22, about P440 million was billed for fuel subsidies and P83 million for the withheld payment.
Delta P previously stated through a letter addressed to Puerto Princesa mayor Lucilo Bayron that the provider could no longer buy fuel on a cash on delivery basis, citing the unpaid UCME by NAPOCOR.
During the hearing, Bayron also said that their plan to pay for the city government’s electricity use in advance won’t work in the long run.
“Isang naisip namin na immediate solution ay magbayad ng advance sa PALECO para maibayad sa power producers para makabili ng fuel. Pero baka kung ilang araw lang ‘yon o linggo lang ‘yon,” he said.
On the other hand, NAPOCOR president and OIC attorney Melchor Ridulme said he would check with the company’s finance department to find out exactly how much Delta P billed them. He said he thought they owed the company less than P100 million.
“Yong sulat ng Delta P na they are going to curtail within the month, tiningnan namin ang billing na pumasok sa amin and we are trying to confirm how much really is nakapending sa amin as bill nila– Ang P500 million, pinapahanap ko sa amin kasi ang nakikita namin na nakapasok na billing nila is around less than 100. Pinapa verify ko sa finance namin,” he said.
Even if they can verify Delta P’s exact billing, NAPOCOR said that it can’t make a one-time payment for the unpaid subsidy because its available funds for UCME are insufficient to pay all new power producers (NPPs).
Ridulme said he will negotiate with Delta P for a staggered payment to settle the entire amount it needs.
NAPOCOR usually pays the NPPs subsidy every third week of the month, and may also start paying the unpaid UCMEs from what budget they have.
“Ang payment namin sa mga NPP, normally third week. So by the third week, pero I have to be honest, ‘yong available UCME namin (ay) hindi kakasya para bayaran sa new power Pproviders namin. Ito ay isang problema din namin, it’s a whole government approach dahil ‘yong subsidy na nari-receive namin pambayad ay kulang na talaga sa new power providers,” he said.
Rimulde noted that NPC already wrote NPPs during June and July to inform them of the insufficiency of NPC’s budget to subsidize from the Energy Regulatory Commission (ERC).
Concerns about rising fuel costs and NPP operating costs led to NAPOCOR declining to subsidize their UCME.
“We wrote them as early as June-July, we already gave them notice that our available subsidy payment is not enough because of the sudden increase in the cost of fuel. At ‘yong cost ng operations ng NPPs tumaas, hindi naging balanseng natatanggap namin subsidy galing sa ERC,” he said.
NPC said that whoever NPP bills first will be prioritized as criteria set for payment of the UCME subsidy. Rimulde did not commit any amount but said it will still pay NPPs like Delta P and is only allocating its available subsidies for UCME.
He stated that the DOE-NEA meeting with NPPs and stakeholders came up with a solution to also find alternative power sources that may supply electric cooperatives.
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