Republic of the PhilippinesENERGY REGULATORY COMMISSI

San MiguelAvenue, Pasig City

IN THE MATTER OF THEAPPLICATION FOR THEAPPROVAL OF THEUPGRADING OF THEPANITAN-NABAS 138kVTRANSMISSION LINE, WITHPRAYER FOR THE ISSUANCEOF A PROVISIONALAUTHORITY

ERC CASENO. 2014-181 RC

GRIDTHE

NATIONALCORPORATION OFPHILIPPINES (NGCP),

Applicant.J(- - - - - - - - - - -- - - - - - - - - - - - -J(

DO.CRETEl)nate:. ~~\~~.!U..ld.E.,-: w: -

DECISION

Before the Commission for resolution is the applicati~n filed on.12 December 2014 by the National Grid Corporation of thePhilippines (NGCP) for approval of the upgrading of the Panitan-Nabas 138kV Transmission line, with prayer for the issuance of aprovisional authority.

Having found said application. sufficient in form and insubstance with the required fees having been paid, an Order and aNotice of Public Hearing, both dated 16 March 2015, were issuedsetting the case for initial hearing on 26 May 2015.

In the same Order, NGCPwas directed to cause the publicationof the attached Notice of Public Hearing, at its own expense, twice(2X)for two (2) successive weeks in two (2)' newspapers of generalcirculation in the Philippines, with the date of the last publicationto be made not later than ten (10) days before the date of thescheduled initial hearing. It is also directed to inform the consumXerswithin its franchise area, .by any other means available and /

. . . If.

ERCCase No. 2014-181RCDECISION/26 November 2015Page 20f14

appropriate, of the filing of the instant application, its reasonstherefor, and of the scheduled hearing thereon.

The Office of the Solicitor General (OSG), the Commission onAudit (COA) and the Committees on Energy of both Houses ofCongress were furnished with copies of the Order and Notice ofPublic Hearing and were requested to have their respective dulyauthorized representatives present at the initial hearing.

Likewise, the Offices of the Mayors of Quezon City and CebuCity and the Municipalities of Panitan and Nabas were furnished withcopies of the Order and Notice of Public Hearing for the appropriateposting thereof on their respective bulletin boards.

On February 20,2015, SORECOI filed its "Pre-Trial Brief'.

During the 26 May 2015 initial hearing, only NGCP appeared.No intervenor/oppositor appeared nor was there anyintervention/ opposition registered.

At the said hearing, NGCP presented its proofs of compliancewith the Commission's posting and publication of noticerequirements which were duly marked as Exhibits "D" to "R".Thereafter, it conducted an expository presentation of its application.

At the termination of the expository presentation, NGCPpresented its witness Engr. Christian B. Ereno, Head of the VisayasSystem Planning Division of NGCP, who testified in support of theapplication.

In the course of his direct testimony, additional documentswere identified and duly marked as exhibits. Thereafter, theCommission propounded cIarificatory questions on the said witnessand directed the submission of various documents.

On 06 July 2015 and 16 July 2015, NGCP filed its "Compliance"and "Formal Offer of Evidence", respectiv~

f

ERCCase No. 2014-181 RCDECISION/26 November 2015Page 3 of 14

Finding the said evidence relevant and material, theCommission hereby accepts and admits the exhibits contained inNGCP's "Formal Offer of Evidence" and the same shall be consideredin the evaluation of this case.

DISCUSSION

1. PROJECT DESCRIPTION

The Project involves the construction of 123 new steel towerstructures along Panitan-Nabas 138 kV line adopting a new winddesign criteria of 270 kph (from 240 kph). The typical tower designparameters for the proposed transmission line structures are asfollows:

Proposed Upgrading of Pan itan-Nab as 138kVTransmission Lines

Tower Type Suspension/ Line Wind SpanTension/ Angle (m)Dead End (Degree)

DTISUS-ZI-138 Suspension 0-2 400

DT1ten5-Z1-138 Suspension/ 0-5 400Tension

DTlten15-Z1-138 Tension 0-15 400DTlten-ZI-138 Tension 0-45 400DTlde45-Z1-138 Dead End 0-45 300

These towers shall require construction of new foundationssuitable for the new wind design criteria. Existing limits for the.rights-of-way for the Panitan-Nabas 138kV line shall be utilized.However, additional rights-of-way may be required, as other towersshall be located at new sites to be able to construct new fOundatiO%

y

ERC Case No. 2014-181 RCDECISION/26 November 2015Page 4 of 14

2. PROJECT RATIONALE

The project is intended to improve the reliability of the Panitan-Nabas 138kV Transmission Line which suffered catastrophic damagedue to Typhoon Yolanda in 2013.

3. Diagram

Below is the restoration scheme for the 138 kV transmissionsystem in the northern part of the Panay Grid:

Nabas

PanitanBarotacVieio

Dingle

Sta. BarbaraLegend:

Portions with toppled tower structures- De-energized portion of the line_. - Temporary by-pass lines

4. PROJECT COST

The estimated capital investment for these proposed projectsand activities to be implemented amounted to Nine Hundred Thirty-Three Million Seven Hundred Seventy-Four Thousand One HundredNinety-One Pesos and 9n/10 (PhP 933.774,,91.9¥

ERCCase No. 2014-181RCDECISION/26 November 2015Page 5 of 14

The contract for the supply of materials for the proposedprojects will be assigned to qualified suppliers and contractorsfollowing a competitive bidding and selection process. The fundingwill be sourced through NGCP's Internal Cash Generated (ICG) fund.

The proposed projects will be subject to optimization followingthe principles found in the Rules in Setting the TransmissionWheeling Rates (RTWR).

5. NEED FOR THE PROJECT

Temporary Restoration

Restoration works were conducted to establish by-passtransmission lines that will link the remaining undamaged portions ofthe 138 kV line and provide transmission link towards NabasSubstation. As an interim scheme, Emergency Restoration System(ERS), light-weight modular towers and steel pole structures (beingused for 69 kV overhead lines) were used for the by-pass lines. TheERS utilized a 1 x 795 MCMACSR conductor, while the light-weightmodular towers and steel pole structures utilized a 1 x 336. 4 MCMACSRconductor.

Limitation of the Temporary Scheme

The original configuration of the Panitan-Nabas 138 kV Line,which utilizes 795 MCMACSRconductor, can transmit up to 180 MWof power. On the other hand, the temporary scheme has a limitedtransfer capacity of 100 MW due to the presence of the by-pass linewhich utilizes smaller conductor size.

Some portions of the temporary by-pass lines are located indifficult terrain and limited area. In addition, the by-pass lines aresupported by mostly steel pole structures designed for lower voltagelevel, hence, the design capability of the by-pass lines to meet therequired line clearances is limited. As a result, there is higherpossibility of outage due to line to ground fault which will result tooverloading of the transformers and load curtailment at PanitanSubstation. In addition, more frequent ROW clearing activities will berequired along the by-pass lin.~s in~er to maintain minimumcleanmee,fromnearbYVegetati0/f'

ERC Case No. 2014-181 RCDECISION/26 November 2015Page 60f14

Use Of Higher Wind Velocity In The Design OfTransmission Line Structures Affected By Super TyphoonYolanda

Being an archipelagic country with 7,100 islands located at theso called "typhoon alley of the world", the Philippines is exposed tovery strong winds especially during the passage of tropical cyclones.

Over the years, the PAGASA has compiled a database oftyphoons that crossed or made landfall in the Philippines during thepast decades. The frequency of these typhoons from 1948 to 2013 ispresented in the following tables.

Annual Number of Tropical Cyclones in the PARPeriod: 1948-2013

40_ Number of Tropical CyclOnes

35Ul

"<:o 30U•..tJ~ 25

a.~ 20...'l;m 15

'"E:i 10

5

- Five-year runnIng mean

-linear (Five-year runningmean)

Y •• -o.026x -+ 20.22

o1948 1953 1958 1963 1966 1973 1976 1983 1988 1993 1998 2003 2006 2013

Year

During the 65-year period, an annual average of 19 to 20typhoons occurred in the Philippine Area of Responsibility (PAR).The most number of typhoons occurred in 1993 which recorded 32~least numb" oftypboon,occurredin 1998wbich",ooroed

ERC Case No. 2014-181 RCDECISION/26 November 2015Page 7of14

2018

16

14

012I-~ 10oz 8

64

2

o~51~57ro~~~72~~81M870093%~02~

Year

An annual average of 8 or 9 typhoons made landfall/crossed thecountry. During the 59 year period, 19 typhoons were recorded tohave made landfall in 1993, which is the highest incidence; while 4each were recorded in the years 1955, 1958, 1992 and 1997 which isthe least.

Current NGCP Design Basis

The wind loads currently being used by NGCP in the design oftransmission towers are based on the provisions stated in the 2008Philippine Electrical Code Part 2, particularly the Basic Wind ZoningMap covering the PhiliPPin/-;/

r

ERC Case No. 2014-181 RCDECISION/26 November 2015Page 8 of 14

Basic Wind Speed is the maximum sustained wind III kphmeasured at an interval of 3 seconds at 10 m above ground .

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ERC Case No. 2014-181 RCDECISION/26 November 2015Page 9 of 14

Evolution ofWind Design Specifications

The tabulation below illustrates the development of wind designspecifications used in the design of power transmission structures:

Prior to 1970SUP 1990S to 20082008 to

1970S to 1990S present

NPC*/ (3-sec gust(3-sec gustwind)

TRANSCO* 165 kph 185kphwind) Zone 1: 270

/NGCP* Zone 1: 270 kphPractice Zone 2: 240 kph

Zone 2: 240Zone 3: 160

2000 PEC-2 2008 PEC-2128 kph* (3-sec gust

Basis/ NPCSpecs NPCSpecs (lO-min wind)Reference 165kph 185kph sustained wind) Zone 1: 270

Zone 2: 240'Equiv to 212 k~~ (3-SOtgust Zone: 160wind

"NPC - up to year 2003*TransCo - 2003 to 2009-NGCP- 2009 to present

OFFICIAL SEVERE WEATHER BULLETINS ISSUED BYNDRRMC

The table below is the severe weather bulletins issued by theNational Disaster Risk Reduction and Management Council(NDRRMC) showing the locations and wind gustiness per period ofTyphoon Yolanda.

[~_=32~O=:J[ 360~

I 360 I_. [ 360 1

[_370 IY

SEVERE MAXIMUM HIGHEST r IWEATHER! DATE TIME LOCATION OF o-MONUlli -MrnUffi EQUNALENT '1IlULLETIN CENTER USTAINED MEAN [ SEC GUST

No.twIND (kph)' GUST. WINDi I (kph) L .

1 6-Nov-13 SPM PACIFIC OCEAN 195 230

2 7-Nov-13 2AM PACIFIC OCEAN 215 250,

3 SAM PACIFIC OCEAN 215 250

4 2PM PACIFIC OCEAN 215 250r

4A 6PM 453KMSEOF 225 260GUIUAN, SAMAR

ERCCase No. 2014-181RCDECISION/26 November 2015Page 10 of 14

,

r, ~

10

11

12

9-Nov-13 2AM

8AM

2PM

WEST OFMINDORO

WEST PHIL SEA

OUTSIDE PAR

175

175

370 ]390 I360 I360 I320 I290 I290 1310 I

As shown in the table below, it is clear that the wind velocitiescarried by Super Typhoon Yolanda were greater than the design windvelocity used on the transmission lines, thus constituting the maincause of tower toppling.

NUMBER OF WIND VELOCITY WIND VELOCITY

TRANSMISSION LINE TOPPLED USED IN DESIGN DURING

TOWERS (3-sec GUST) YOLANDA(to-min 13-sec)

Panitan-Nabas 138 kV TIL 134 240 kph 215 kph I 360 kph

Ormoc-Isabel138 kVT/L 74 270 kph 235 kph I 390 kph

Based on the foregoing, the following are the reasons for the useof higher wind velocity in the design of transmission line structures:

1. There is certainly a need to increase the design wind speedsto meet the stronger winds carried by typhoons;

2. It may not be practicable to increase the design wind speedparameters up to or even greater than the maximumreco,ded wind speed experienced; '/f

ERC Case No. 2014-181 RCDECISION/26 November 2015Page 11of 14

3. Striking a balance between structural adequacy and costimplications, NGCP used the proposed design wind velocityindicated in the table below:

WIND VELOCITY PROPOSED DESIGN

TRANSMISSION LINE USED IN DESIGN WIND VELOCITY(3-SEC GUST) (3-SEC GUST)

Panitan-Nabas 138 kVT/L 240 kph 270kph

Ormoc-Isabel 138 kVT/L 270kph 300kph

Proposed Upgrading ofthe Panitan-Nabas 138 kV Line

The project will involve the construction of new steel towerstructures which are in conformity with required design standards for138 kV lines and will provide more reliable clearances betweenoverhead lines and nearby vegetation. The new structures willsupport the use of power conductors with higher capacity, hence, willincrease the transfer capacity of Panitan-Nabas 138 kV Line from 100MWto 180 MW.

Relocation of Tower Structures

New transmission line structures will be constructed in lieu ofthe toppled tower structures. The new tower structures shall belocated at new sites to be able to construct new foundations that shalladopt the new wind design criteria.

There is a need to immediately complete the upgrading of thePanitan - Nabas 138 kV Transmission Line in order to achieve thefollowing:

1. To minimize exposure to fault along the temporary by-pass lines for the Panitan - Nabas 138 kV Lines, hence,will avoid load curtailment in Panitan SUbstatio~

f

ERCCase No. 2014-181 RCDECISION/26 November 2015Page 12 of 14

2. To achieve maximum transfer capacity of 180 MW alongPanitan - Nabas 138 kV Line; and

3. To retrieve the temporary structures used for the by-pass lines to ensure sufficient availability of temporarystructures for future emergency use. .

A perusal of the evidence presented herein showed that NGCP'sapplication for the approval of the upgrading of the Panitan- Nabas138kV transmission line is in accordance with the provisions ofRepublic Act No. 9136 and the "Resolution Amending the Rules forApproval of Regulated Entities' Capital Expenditure Projects" andwill redound to the benefit of its consumers in terms of continuous,reliable and efficient power supply as mandated by Republic Act No.9136 or the Electric Power Industry Reform Act of 2001 (Section 2.Declaration of Policy - (b) "to ensure the quality, reliability, securityand affordability of the supply of electric power).

WHERFORE, the foregoing premises considered, theapplication filed by NGCP for the approval of the upgrading of thePanitan- Nabas 138kV transmission line, with prayer for provisionalauthority, is hereby APPROVEDsubject to the optimization based onits actual use and/or implementation during the reset process for thenext regulatory period following the procedures stated in the Rulesfor Setting Transmission Wheeling Rates (RTWR) and other relevantissuances of the Commission.

Relative thereto, NGCP is hereby directed to conductcompetitive bidding for the purchase of major materials in theimplementation of the proposed projects.

Further, NGCP is directed to pay, within fifteen (15) days fromreceipt hereof, a total permit fee in the amount of Seven MillionThree Thousand Three Hundred Six Pesos(PhP7,OO3,306.oo), computed"" fOllOWS/1

ERC Case No. 2014-181 RCDECISION/26 November 2015Page 13 of 14

Permit Fee = Total Estimated Project Cost X 0.7.5100

= PhP 933,774,191.90 x 0.75100

Permit Fee =

SO ORDERED.

Pasig City, 26 November 2015 .

JOSE VICENTE B. SALAZARChairman & CEO~

.ERe ----.-\Office of the Ch.airman '

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ERONIMO D. STA. ANACommissioner

w~GLqRIA VICTORIA

Commissio

(On Leave)ALFREDO J. NONCommissioner

JOSEFINA PA CIAA. MAGPALE-ASIRITCo

M~g/ APV /Legal~decision_2014-18trc ngcp

ERC Case No. 2014-181 RCDECISIONj26 November 2015Page 14 of 14

Copy Furnished:

1. Attys. Luis Manuel U. Bugayong, Ronald Dylan P.Concepcion, Mark Anthony S. Actub, Raycell D.Baldovino andAri Vergil P. FabrosCounsel for NGCPNational Grid Corporation of the Philippines (NGCP)NGCP Building, Quezon Avenue cor. BIR RoadDiliman, Quezon City, Metro Manila

2. The Office of the Solicitor General134 Amorsolo Street, Legaspi Village, Makati CityMetro Manila

3. The Commission on AuditDon Mariano Marcos AvenueDiliman, Quezon City, Metro Manila

4. The Senate Committee on EnergySenate of the PhilippinesGSIS Building, Roxas Blvd., Pasay City, Metro Manila

5. The House Committee on EnergyHouse of RepresentativesBatasan Hills, Quezon City, Metro Manila

6. Office of the City MayorQuezon City

7. Office of the Municipal MayorMunicipality of NabasProvince of Aklan

8. Office of the Municipal May rMunicipality of Panita~ /1Province of Capiz / L!