THE National Grid Corp. of the Philippines (NGCP) was allowed by the regulators to complete the 138-kiloVolt (kv) Nabas-Caticlan-Boracay transmission line project in August next year.
The P5.48-billion project is meant to reinforce the grid and upgrade existing facilities to support the growing power requirements of Boracay.
In a 12-page order, the Energy Regulatory Commission (ERC) granted NGCP’s motion to extend the estimated time completion of the transmission project to August 31, 2026, ‘taking into account both the technical realities on the ground and the legal obligations of NGCP under its franchise and the regulatory framework governing transmission projects.’
The NGCP was earlier directed by the commission to complete the project not later than May 31, 2025, six months after the directive was issued. The grid operator filed a motion last July to reverse the ERC ruling for lack of basis. It also asked to exempt it from paying the permit fees.
The commission said that the adjustment of timeline is ‘justified’ as its completion is necessarily subject to unforeseen factors such as site workability, right-of-way acquisition, procurement processes, and other construction challenges.
‘After due deliberation, through evaluation of all the evidence gathered, and appreciation of all the information gathered, the Commission, pursuant to its regulatory powers, hereby resolves to grant NGCP’s motion to adjust the project’s estimated time of completion to August 2026,’ the ERC said.
However, any further delay shall be subject to stricter regulatory scrutiny and possible penalties, it added.
The ERC denied NGCP’s request to exempt it from payment of permit fees worth P31,781,408.30. The said fee is in relation to the project and is collected by the ERC. The commission said it was ‘not convinced’ when the NGCP argued that its franchise exempted it from the payment of permit fees.
‘Tax exemptions are strictly construed against the taxpayer. For an exemption to be conferred, it must be clearly and distinctly stated in the language of law. The burden rests upon the party claiming the exemption to prove that it is in fact covered by the exemption so claimed which NGCP failed to do so,’ the ERC said adding that the tax provision outlines the taxes that NGCP is liable for or exempt from.
‘What was granted to NGCP was a franchise tax in lieu of all other taxes that maybe imposed on NGCP,’ the regulator said.
The NGCP was also directed to assume full responsibility for the operation, maintenance, and management of the reclassified assets-Avon-Caticlan 69kV line, the Caticlan Cable Terminal Stations, and the Caticlan-Boracay 69kV submarine cable.
The ERC decision was promulgated last October 8.