BNPP fund eyed to keep power in 1.3 million rural households

The government is planning to tap P367 million in reimbursements for the upkeep of the mothballed Bataan Nuclear Power Plant (BNPP), along with subsidies and borrowings, to avert a looming power crisis that may affect more than 1.3 million rural households nationwide.

Officials of the National Power Corp. (Napocor) told a virtual press briefing on Monday that the state-run corporation was running out of funds to supply fuel to power plants that deliver electricity to remote regions.

Napocor suggested it might be constrained to curtail the operating hours of Small Power Utilities Group (SPUG) power plants and ration the remaining fuel stockpile should it fail to secure additional funding.

'We intended to - and I know many people don't like the term - but [dispense] equal misery. We won't favor anybody. We will dispense the available fuel as much as possible fairly,' said Napocor president and CEO Fernando Martin Roxas.

He said the idea had been announced as early as February but Napocor decided to defer the move until March as 'we have not finished the consultations.'

Island towns, provinces

Under the Electric Power Industry Reform Act, Napocor is responsible for supplying power to areas not connected to the main grid using SPUG plants.

SPUG plants are scattered nationwide, mostly in remote areas, including island towns and provinces in Luzon, the Visayas and Mindanao.

According to Roxas, the main challenge of sustaining the operations of SPUG plants is securing fuels to buy additional fuel.

'Of course, the big issue is the funding deficit. There is fuel to be bought but the problem is lack of money to purchase it,' he added.

To overcome the deficit, Napocor is seeking a P5-billion loan from government financial institutions, which requires special authority from the President.

It is also trying to secure government subsidies through the Department of Budget and Management as well as reimbursement of about P367 million in advances for the preservation and maintenance of the BNPP in Morong town, Bataan province.

The government allocates more than P50 million almost yearly for the upkeep and maintenance of the 620-megawatt nuclear facility under Napocor's budget.

The BNPP was built during the first Marcos administration in the mid-1970s by Westinghouse Electric at a cost of $2.3 billion. But it was never fueled due to safety concerns and amid corruption allegations.

Maintenance cost

Under the 2023 budget, Congress earmarked P76.66 million for BNPP preservation with P22.72 million for personnel services and P53.94 million for maintenance and other operating expenses.

In November, Sen. Risa Hontiveros proposed that the BNPP maintenance fund be realigned to economic programs.

That same month, Napocor said it was seeking reimbursement of P404 million in advances made to maintain the BNPP between 2011 and 2023 as one of its contingency measures to address budgetary constraints.

Napocor is also banking on the Energy Regulatory Commission's swift approval of its pending petition on the universal charge for missionary electrification which, if approved, will give the corporation another P30 billion.

'Unfortunately, there are applications as far back as 2014 that have not been acted upon and that amounts to P30 billion alone,' said Energy Secretary Raphael Lotilla.

According to Napocor, it will need about P11.5 billion to meet its fuel requirements this year, equivalent to 150,555 kiloliters.

But the budget allocated by the government for fuel for SPUG plants is only P7.5 billion, enough to procure 100,608 kiloliters that may last until Aug. 31.

This would leave Napocor with a deficit of P3.7 billion to buy the remaining 49,947 kiloliters.

Adding to Napocor's troubles are its outstanding payables totaling P6.539 billion as of Jan. 26.

Odette Rivero, manager for Napocor's Strategic and Business Planning Division, hinted that the operating hours of some SPUG plants might be cut from 24 hours to 15 hours.

Other plants running for 16 hours may be reduced to 12 hours and those operating for less than that may be slashed to five hours, added Rivero, also a Napocor spokesperson.