27/09/2022
Energy Secretary Raphael P.M. Lotilla welcomes the Opinion of the Department of Justice - Philippines (DOJ), which allows the National Power Corporation (NPC) to draw on funding sources other than the Universal Charge for Missionary Electrification (UCME) to fulfill its mandate of energizing the areas in the country which are not connected to the main grid and ensure a stable and reliable power supply in these areas.
In its Opinion No. 20 Series of 2022 dated 23 September 2022, the DOJ indicated that NPC has the legal authority to borrow funds or contract loans to fulfill its missionary electrification function in the off-grid areas pursuant to its Charter and the mandate established under Section 70 of Republic Act No. 9136 or the Electric Power Industry Reform Act of 2001 (EPIRA).
Section 70 of the EPIRA states that NPC shall remain as a National Government-owned and-controlled corporation to perform the missionary electrification function through the Small Power Utilities Group (SPUG) and shall be responsible for providing power generation and its associated power delivery systems in areas that are not connected to the transmission system. NPC-SPUG is currently supplying two hundred twenty-nine (229) missionary areas throughout the Philippines, most of which have yet to attain a 24-hour electric power service.
โWe express our appreciation to the DOJ for this very timely news. We are also grateful for the support of the entire NPC Board, particularly the Department of Finance as Chairman, the Department of Budget and Management, Agriculture, Environment and Natural Resources, Interior and Local Government, Trade and Industry, and the National Economic and Development Authority (NEDA) as members,โ Secretary Lotilla said.
โThe favorable Opinion will allow the NPC to establish a credit line with local banks that would enable it to manage the fuel price increase that has significantly affected the NPCโs financial position. The funds of NPC sourced from the UCME is not sufficient to support NPCโs current operation,โ Secretary Lotilla said. โThis underlines the efforts of NPCโs Board and Management to ensure timely payments to NPCโs New Power Providers (NPP),โ he added.
Secretary Lotilla also said that this favorable Opinion would finally enable the NPC, after two decades, to ramp up renewable energy sources in the off-grid areas and improve island-wide transmission in the major off-grid islands, particularly through Public-Private Partnership (PPP) arrangements.
He also assured that with the oversight agencies in the NPC Board led by the Secretary of Finance as Board Chairman and the DBM and the NEDA as members, the necessary controls are now in place under the EPIRA for the judicious use of the power to contract loans. # # #
Taguig City - Energy Secretary Raphael P.M. Lotilla welcomes the Opinion of the Department of Justice - Philippines (DOJ), which allows the National Power Corporation (NPC) to draw on funding sources other than the Universal Charge for Missionary Electrification (UCME) to fulfill its mandate of energizing the areas in the country which are not connected to the main grid and ensure a stable and reliable power supply in these areas.
In its Opinion No. 20 Series of 2022 dated 23 September 2022, the DOJ indicated that NPC has the legal authority to borrow funds or contract loans to fulfill its missionary electrification function in the off-grid areas pursuant to its Charter and the mandate established under Section 70 of Republic Act No. 9136 or the Electric Power Industry Reform Act of 2001 (EPIRA).
Section 70 of the EPIRA states that NPC shall remain as a National Government-owned and-controlled corporation to perform the missionary electrification function through the Small Power Utilities Group (SPUG) and shall be responsible for providing power generation and its associated power delivery systems in areas that are not connected to the transmission system. NPC-SPUG is currently supplying two hundred twenty-nine (229) missionary areas throughout the Philippines, most of which have yet to attain a 24-hour electric power service.
โWe express our appreciation to the DOJ for this very timely news. We are also grateful for the support of the entire NPC Board, particularly the Department of Finance as Chairman, the Department of Budget and Management, Agriculture, Environment and Natural Resources, Interior and Local Government, Trade and Industry, and the National Economic and Development Authority (NEDA) as members,โ Secretary Lotilla said.
โThe favorable Opinion will allow the NPC to establish a credit line with local banks that would enable it to manage the fuel price increase that has significantly affected the NPCโs financial position. The funds of NPC sourced from the UCME is not sufficient to support NPCโs current operation,โ Secretary Lotilla said. โThis underlines the efforts of NPCโs Board and Management to ensure timely payments to NPCโs New Power Providers (NPP),โ he added.
Secretary Lotilla also said that this favorable Opinion would finally enable the NPC, after two decades, to ramp up renewable energy sources in the off-grid areas and improve island-wide transmission in the major off-grid islands, particularly through Public-Private Partnership (PPP) arrangements.
He also assured that with the oversight agencies in the NPC Board led by the Secretary of Finance as Board Chairman and the DBM and the NEDA as members, the necessary controls are now in place under the EPIRA for the judicious use of the power to contract loans. # # #
