Press Release
July 12, 2019

Gatchalian champions Microgrid Systems bill for total PH household electrification

Senator Win Gatchalian has vowed to prioritize the passage of a bill in the 18th Congress that will spur microgrid development in unserved and underserved areas nationwide to help the government achieve its goal of 100% household electrification level by 2022.

Senate No. 175, otherwise known as the Microgrid Systems Act, was one of the 10 priority bills that Gatchalian filed early this month as part of his advocacy to increase the spending power of consumers by lowering electricity rates.

Gatchalian, chair of Senate Committee on Energy, explained that the Microgrid Systems Act aims to provide reliable electric services to every household in the country and accelerate total electrification in areas with no electricity access, no distribution system lines, no home power systems, or no connection to any microgrid.

"The government has stated that total electrification in unserved areas cannot be done by traditional grid extension alone and that non-traditional means - such as microgrid systems - are needed. The problem of energy access is also a concern even in 'electrified' areas with limited electricity service, or what we call underserved areas," the lawmaker pointed out.

Furthermore, Gatchalian said the bill will also level the playing field for all system providers.

"The government has tapped the private sector as partner in delivering electricity and improving the quality service in unserved and underserved areas. However, there are significant barriers to entry because of tedious bureaucratic processes, lack of information on prospective areas for electrification, and difficulties obtaining waivers from incumbent utility franchise holders," he explained.

Gatchalian believes SBN 175 will address the acceleration of total electrification and the provision of reliable electricity service in unserved and underserved areas, as it paves the way for the installation of microgrid systems by accredited Microgrid Service Providers (MSPs).

The bill also creates a streamlined process for MSPs with clear timelines and stiff sanctions for bureaucratic red tape and delay. It also removes the requirement of obtaining waivers from incumbent franchised utilities for MSPs to provide electricity in unserved and underserved areas.

Gatchalian said generation companies, distribution utilities, retail electricity suppliers, or their respective subsidiaries or affiliates may engage in the business of MSPs in unserved and underserved areas, provided that a separate account is maintained for such business undertaking.

Citing data from the DOE, Gatchalian pointed out that as of 2018, an alarming number of 2,779,530 households, or 11.7 percent of the total number of households nationwide, still have no access to electricity.

He also noted that at least 45% or 83 of the 171 areas serviced by the National Power Corporation - Small Power Utilities Group received only 4 to 8 hours of electricity service in 2018 while 34 or 19.9% of areas received only 9 to 16 hour of electricity service.

"If we want to achieve 100-percent household electrification by 2022, we need to look for other technologies. Let's improve the process of electrification," he said.

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