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Approved For Ed Approved for Republic of the Philippines ENERGY REGULATORY COMMISSION San Miguel Avenue, Pasig City IN THE MATTER OF THE APPLICATION FOR THE APPROVAL OF THE CEBU- NEGROS-PANAY 230 KV BACKBONE PROJECT (STAGE 1), WITH PRAYER FOR THE ISSUANCE OF A PROVISIONAL AUTHORITY ERC CASE NO. 201 3-024 RC NATIONAL GRID CORPORATION OF THE PHILIPPINES (NGCP), 1)0 CKTED Applicant. Date: ,J4i,J..2fli4 x----------------------- x 'V — DECISION Before this Commission for resolution is the application filed on February 15, 2013 by the National Grid Corporation of the Philippines (NGCP) for approval of its Cebu-Negros-Panay 230 kV backbone project (Stage I), with prayer for provisional authority. Having found said application sufficient in form and in substance with the required fees having been paid, an Order and a Notice of Public Hearing, both dated March 11, 2613, were issued selling the case for jurisdictional hearing, expository presentation, pre-trial conference and evidentiary hearing on April 24, 2013. In the same Order, NGCP was directed to cause the publication of the Notice of Public Hearing, at its own expense, twice (2x) for two (2) successive weeks in. two (2) newspapers of general circulation in the Philippines, with the date of the last publication to be made not later than ten (10) days before the date of the scheduled initial hearing. It was also directed to inform the consumers, by any other means available and appropriate, of the filing of the instant application, its reasons therefor and of the scheduled hearing thereon. ERC Case No. 2013-024 RC DECISION/June 24, 2013 Pane 2 of 8 The Office of the Solicitor General (OSG), the Commission on Audit (COA) and the, Committees on Energy of both Houses of Congress were furnished with copies of the Order and Notice of Public Hearing and were requested to have their respective duly authorized representatives present at the initial hearing. Likewise, the Offices of the Mayor of Quezon City and the Provincial Governors of Cebu, Negros Oriental, Negros Occidental, lloilo, Capiz, Antique and Aklan were furnished with copies of the Order and Notice of Public Hearing for the appropriate posting thereof on their respective bulletin boards. On April 19, 2013, NGCP filed its "Pre-Trial Brief'. During the April 24, 2013 initial hearing, only NGCP appeared. No intervenór/oppositor appeared nor was there any intervention/opposition registered. At the said hearing, NGCP presented its proofs of compliance with the Commission's posting and publication of notice requirements which were provisionally marked as Exhibits "A" to "Y", inclusive. Thereafter, it conducted an expository presentation of its application. At the termination of the expository presentation, NGCP presented its lone witness, Engr. Christian B. Ereño, its Head of the Visayas System Planning Division, who testified in support of the instant application. In the course thereof, additional documents were presented and duly marked as exhibits. The direct examination having been terminated, the Commission propounded clarificatory questions. NGCP was, then, directed to file various documents and its formal offer of evidence. On May 6, 2013 and May 10, 2013, NGCP filed its "Formal Offer of Evidence" and "Compliance", respectively. On May 24, 2013, the Commission issued an Order admitting NGCP's "Formal Offer of Evidence" and declaring the case submitted for resolution. ERC Case No. 2013-024 RC DECISION/June 24, 2013 Pacje3of8 DISCUSSION I. Project Description The Cebu-Negros-Panay (CNP) 230 kV Backbone Project involves the construction of a 230 kV transmission corridor from Compostela Substation in the Province of Cebu to the Barotac Viejo Substation in the Island of Panay. The project requires the: a) installation of submarine cables and overhead lines; b) expansion of the existing substations that are associated with the project; and c) construction of new substation. The CNP 230 kV Backbone Project comprises two (2) circuits with a total length of approximately 238 kilometers. It will directly link some of the major bulk substations, such as the Bacolod and Cebu Substations, in the Visayas Region. Upon full completion of the project, the overhead transmission lines can accommodate 600 MW per circuit while the submarine cable interconnections will have a rated capacity of 300 MW per circuit. Shown below is a diagram of the proposed project's development map: Diagram: Development Map of CNP 230 kV Backbone Project (stage 1) PANAY ISLAND 1 i Expansion of Barotac I viejo Substation I Expansion of E. B. Proposed submarine/ . Magalona Cable underground cables, - - Terminal Station 44, usree singIe-core / 1,600 mm2 XLPE cable, 22.75 km \ •- / Proposed overhead lines, double circuit of so-bundled 795 MCM - V ACSR conductor, 45 km / / •EGROS Expansion of Bacolod • "TSlAND \:-: Substation e ERC Case No. 2013-024 RC DECISION/June 24, 2013 Pacie4of8 Stage 1 of the proposed project includes the installation of additional submarine cables in the Negros—Partay Submarine Cable Interconnection, overhead transmission lines and expansion works at Barotac Viejo Substation, E.B. Magalona CTS and Bacolod Substation. These are intended to immediately address the projected overloading of the Negros-Panay 138 kV Submarine Cable Interconnection and Bacolod - E.B. Magalona 138 kV Line in view of the entry of new generating plants in the Panay Island by 2016. II. Components of the Proposed Project A. Additional Submarine Cable Interconnection A single circuit submarine cable system will be installed between the Barotac Viejo Substation in Panay and the E.B. Magalona CTS in Negros Occidental. A twenty two (22)-kilometer, three (3) single-core of 1,600 mm 2 XLPE sub-cables will be installed in northeast side of the existing Negros-Panay 138 kV Submarine Cable Interconnection. A single circuit underground cable measuring seven hundred fifty (750) meters of three (3) single-core of 1,600 mm2 XLPE cables will also be installed to link the proposed additional submarine cables to the Barotac Viejo Substation Switchyard. B. Overhead Transmission Lines A double circuit overhead transmission line supported by steel tower structures will be constructed from E.B. Magalona CTS towards Bacolod Substation. It is forty five (45) kilometres in length with two- bundle seven hundred ninety-five (795) MCM Aluminum Concrete Steel Reinforced (ACSR) conductors per circuit. The proposed overhead transmission line was designed at 230 kV but it will be initially energized at 138 kV. C. Proposed Substation Expansion Six (6) 138 kV PCBs, one (1) 40 MVAR Line Reactor and one (1) set of cable sealing end structures and associated equipment will be installed at the Barotac Viejo Substation to accommodate the termination of the proposed additional submarine cables and the p 1 ERC Case No. 2013-024 RC DECISION/June 24, 2013 Page 5 of 8 incoming 138 kV transmission line from Concepcion Coal-Fired Power Plant. On the other hand, one (1) set of cable sealing end structures and associated equipment will be installed at the E.B. Magalona Substation for the proposed additional submarine cables and the overhead transmission lines towards Bacolod Substation. Two (2) 138 kV PCBs and associated equipment will be installed at the Bacolod Substation to accommodate the termination of the proposed overhead transmission lines from E.B. Magalona CTS. The additional submarine cable interconnection and overhead transmission line (Stage I CNP 230 kV Backbone Project) was designed at 230 kV but it will be initially energized at 138 kV. This scheme will provide a provision for additional transmission capacity to accommodate new generating plants in the Panay Island beyond 2015. Ill. Rationale of the Project The proposed project aims to increase the power transfer capability of the submarine cable interconnection between the Provinces of Cebu, Negros, and Panay. The extension of the existing 230 kV transmission corridor from Compostela Substation in Cebu to the Island of Panay shall provide a reliable transmission corridor in the Islands of Cebu, Negros, Panay and Leyte in consonance with the development of new generating plants and the increasing power demand in the Visayas Grid. The proposed project will also relieve the existing 138 kV transmission corridors in Negros and Cebu Islands from power flow congestions during single line outage conditions and will optimize the Leyte-Luzon ±350 kV HVDC Line. IV. Advantages of the Proposed Project It is significant to note that upon the establishment of new generating facilities by 2016, there will be potential excess power of ERC Case No. 2013-024 RC DECISION/June 24, 2013 Page 6 of 8 about 574 MW and 692 MW during peak and off-peak demands, respectively, in Panay Grid that may be exported towards Negros Island. Presently, the entry of the New Power Providers (NPPs) in Panay Island would provide an excess generation capacity of 361 MW and 479 MW during peak and off-peak demands, respectively, by 2016. Thus, the timely implementation of the project will provide sufficient power transmission capacity in the Island of Negros. V. Project Cost NGCP proposed to infuse the amount of Twelve Billion Nine Hundred Forty Four Million Nine Hundred Ninety One Thousand Four Hundred Six Pesos and 27/100 (PhP12,944,991,406.27) for the capital investment of its proposed project which will be funded through its Internal Cash Generated (ICG) fund. The proposed project will be subject to optimization and asset classification based on its actual use pursuant to the Rules for Setting Transmission Wheeling Rates (RTWR) and other relevant issuances of the Commission. A perusal of the evidence presented herein showed that the approval of NGCP's Cebu-Negros-Panay 230 kV backbone project (Stage 1) is in accordance with the Commission's "Resolution Amending the Rules for Approval of Regulated Entities' Capital Expenditure Projects" which will redound to the benefit of the consumers in terms of continuous, reliable and efficient power supply as mandated by Republic Act No.
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