Senate panel considering microgrids for rural power

THE SENATE energy committee is studying a plan to use the annual budget for rural electrification of nearly P5 billion to build microgrids to speed up the delivery of electricity in remote areas, its chairman said.

“By our computation, every year we allocate about close to P4 [billion], almost P5 billion in sitio and rural electrification. We plan to re-channel that to a microgrid project instead, because rural electrification is never completed,” Senator Sherwin T. Gatchalian told reporters after a recent energy forum.

He said one of the policies that he was looking at to promote microgrids — and their smaller version, minigrids — is to provide them with subsidies through the re-channeled funds from missionary electrification, which is collected from all on-grid electricity users.

He said the policy concept would be the subject of a resolution that he is planning to file before the government’s budget season.

A number of companies have previously expressed interest in putting up microgrids, which is a complete system with its own power resources, generation and load centers within a defined boundary.

However, electric cooperatives have criticized these plans, calling them an encroachment on their franchise areas by using total electrification as a guise to expand the private companies’ areas of operation.

Mr. Gatchalian said the National Electrification Administration (NEA), which oversees the electric cooperatives as well as rural electrification, had identified areas that are not provided with 24/7 electricity.

“We will prioritize those areas,” he said.

“Government can step in if the electric coop is not providing 24/7 electricity. And government can step in in two ways,” he said.

“Government can build the microgrid. I think they [government] can empower the local government units to do it, or ask the private sector to come in and build. I prefer the second one.”

He said he prefers the second option, which would not require a capital outlay from the government.

“But they have to open it up to the private sector to build the microgrid,” he said.

He said his committee has yet to study how many microgrids could be built using the electrification funds.

Asked about possible resistance from electric cooperatives, he said these entities should now be putting up microgrids if they intend to energize the unserved or underserved areas.

“But if [they’re] not providing 24/7 [electricity], that’s a failure on their part,” he said, adding that the electric cooperatives’ franchise is a privilege that the government can take back.

“The franchise is a privilege that the government gave you, but if you’re not using that privilege, we will take it back at least in that specific area. And government can step in to build or to ask somebody to build it,” he said.

Data from NEA show that as of May 2018, all cities and municipalities in the country have been energized, but there were barangays and sitios that remained without electricity. The agency placed the number of unserved barangays at 10, and the sitios at 24,496. —