NGCP Eyes a Unified National Grid by 2020 Through the MVIP

As the Philippines continues on its path of greater economic growth and development, the demand for electricity among industries, communities, and households will also continue to grow, and this demand can only be addressed by strengthening the nation’s power grid.

As a response to this growing demand for reliable electricity transmission, NGCP launched the Mindanao-Visayas Interconnection Project (MVIP), eyed to connect the three power grids of Luzon, Visayas, and Mindanao into one unified national grid by 2020.

“With One Grid 2020, we envision a strong, unified power transmission network that can meet the country’s future power needs,” said NGCP.

What is the MVIP?

The MVIP is NGCP’s latest project that aims to connect the Mindanao grid to the Visayas grid, and which will ultimately lead to a single, unified national grid by the time of its completion in 2020.

“With a unified national grid, power transmission services in the country will be more reliable as there will be less power interruptions nationwide due to the sharing of local energy resources. Reliable electricity transmission, in turn, could help boost investments, infrastructure development, and commerce in the country,” said NGCP.

After five years of careful research and planning, the Energy Regulatory Commission (ERC) has authorized the NGCP to start building the MVIP in 2017, with the project set to be completed by December 2020.

Currently, the country harnesses most of its electricity from the interconnected Luzon and Visayas grids, which was linked in 1998 and uses a high-voltage direct current (HVDC) system with a 440-megawatt (MW) capacity. Once the MVIP is complete by 2020, it will be using an HVDC system with a 450-MW initial capacity.

The MVIP will employ 184 circuit-kilometers of submarine cables, plus 526 circuit-kilometers of overhead wires, to connect Dapitan, Zamboanga del Norte to Santander, Cebu using HVDC submarine cables, which will transmit energy efficiently between Visayas and Mindanao with minimal loss.

The completion of the MVIP will result in a more stable and secure supply of power in the country, and will maximize the use of available local energy resources.

“This will support the national government’s vision to interconnect the major power grids, which would then help improve the overall power supply security of the country through the sharing of reserves,” said the company. “This will also support the overall operations of the Philippine electricity market by allowing the optimization of all available energy sources, including the additional generation capacities that will be implemented in Visayas and Mindanao.”

While the final cost of the project has yet to be determined by the ERC, NGCP has filed the estimated cost of the project to be at PHP52 billion. Depending on the regulatory reset by 2020, consumers might also notice the immediate effects of the project on their electricity bills as its completion will result to a price increase of PHP0.03 per kilowatt-hour (kWh).

“To date, the biggest part of the MVIP is right-of-way access and acquisition, which we expect to secure by the end of December 2018. Therefore, as early as now, we are reaching out to the public, especially all national and local government units, to collaborate with us for the successful completion of the MVIP to meet our goal of One Grid 2020,” appealed NGCP.

The Long Road to a Unified National Grid

While the completion of the MVIP by 2020 bodes well for the country and its electricity transmission reliability, NGCP braved a long and challenging road to ensure that its vision of a strong, unified national grid will become a reality.

As early as 1980 and on through 2004, numerous studies have been conducted by various international development agencies such as the Japan International Cooperation Agency (JICA) and the Asian Development Bank (ADB), among others, to determine the feasibility of the MVIP.

However, it was only between 2011 and 2014 when NGCP prepared an updated feasibility study for the MVIP and completed the hydrographic survey for its Eastern route. The desktop study and the hydrographic study for the Western route, on the other hand, were initiated in 2015 and completed in 2016, which showed favorable results for the Zamboanga del Norte-Cebu interconnection.

In 2017, the ERC finally approved the implementation of the MVIP via the Western route through the Zamboanga del Norte-Cebu interconnection.

Executive Order No. 30 was issued in July of last year, creating an Energy Investment Coordinating Council to streamline regulatory procedures affecting energy projects. By virtue of the Executive Order, the Department of Energy (DOE) declared the MVIP as an Energy Project of National Significance (EPNS) last 08 May 2018.

As an identified EPNS, the issuance of regulatory and documentary requirements by different local and national government agencies will be expedited. “The declaration of the MVIP as an EPNS is a welcome development. This will definitely help us meet the target completion date of December 2020,” the company said.

Under a government-granted 25-year concession, NGCP holds the rights to operate and maintain the country’s transmission system and other related facilities, and to engage in ancillary services that will maximize the utilization of the power transmission network and infrastructure. By making a unified national grid possible through the MVIP, NGCP bridges power and progress by addressing the country’s increasing electricity demand and ensuring reliable electricity transmission.

NGCP is a Filipino-led, privately-owned corporation in charge of operating, maintaining, and developing the country’s state-owned power grid, and is led by majority shareholders Henry Sy, Jr. and Robert Coyiuto, Jr.