The National Grid Corporation of the Philippines (NGCP) is taking major step to ease congestion problems in the transmission system for Luzon grid with the rehabilitation works at its San Jose substation, the major network used for wheeling electricity to Metro Manila and neighboring areas.

Addressing the constrained capacity in that substation will also correspondingly increase the transmission capacity of the lines, it was noted. In turn, this will help bring down electricity rates because congestion generally affects prices, especially at the Wholesale Electricity Spot Market.

The grid operator has started replacement and repair at the four transformers of the substation to 750 megavolt ampere (MVA), hence, bringing their transfer capacities higher. The second one was already energized last August 5.

According to Energy Secretary Rene D. Almendras, the next rehabilitation works will center on transformers 3 and 4, and are scheduled for completion this September and the last one around October 5 this year.

While the repairs are on-going, it was noted that price separation for traded capacity in the spot market may still be on uptrend in the coming months. But beyond October 5, it was noted that line congestion will no longer be a problem at that particular network in the system.

Apart from higher prices, constraints in the lines will not also allow the transmission of cheaper capacities passing through the San Jose substation-integrated lines. To plug that, plants of more expensive fuels will have to be dispatched. “Assuming the rehabs at San Jose will be completed in time, it would also around that time that the hydros will have maximized capacity. By then, we can have cheaper source of electricity, thus, lower rates for consumers,” the energy chief said.

Momentarily, he noted that the generation of 650-megawatt Malaya thermal facility is being maximized and the consequent impact of that, because it is an oil-based plant, will be higher prices. “Around that time (October), the hydros will have a lot of water already so we can start producing cheaper source of electricity. Definitely then, we don’t need to operate Malaya plant as much,” the energy chief stressed.