The National Power Corp. warned of power outages in “missionary areas” covered by Small Power Utilities Group amid the impending shutdown of its diesel plants and its inability to pay fuel suppliers.
NPC department manager for financial planning and budget Jenalyn Aurea Tinonas said in a recent Senate hearing that this would likely occur by the end of July next year following its P12.537-billion budget cut.
Tinonas said the budget reduction would affect about 278 diesel plants.
She said NPC submitted an original proposal of P44.749 billion for 2023, but the Department of Budget and Management slashed this by nearly 30 percent.
Tinonas said the P32.212-billion DBM recommended level would not be enough to cover NPC’s full-year operation requirements for SPUG plants and barges and its new power providers and qualified third-party subsidy requirements.
“If the price of fuel continues to increase, this will become an even bigger dilemma,” she said.
Tinonas said that based on the General Appropriations Act, the approved fuel budget of P6.385 billion for SPUG missionary areas was based on a price assumption of P37.99 per liter for diesel. Fuel prices abruptly increased to as high as P79.66 per liter in June.
The high fuel prices are one reason why SPUG generation companies racked up substantial outstanding obligations to fuel suppliers.
Many fuel suppliers are reportedly reluctant to deliver more fuel on credit, given the volatility of prices and the slow release of funds from the NPC.
The Sultan Kudarat Electric Cooperative Inc. was forced to bypass the NPC last month and buy 120,000 liters of diesel fuel directly from Petron Corp. to avoid power outages.
Tinonas said the delayed payments to SPUG gencos and NPPs and QTPs might result in power outages affecting 834,285 households nationwide.
She said this might also result in the deferment of the scheduled energization of 44 new unserved areas affecting 15 areas in Luzon, 14 in the Visayas and 15 in Mindanao covering 30,940 households in remote islands.