Republic of the Philippines

ENERGY REGULATORY COMMISSION

San Miguel Avenue, Pasig City

16
RESOLUTION NO. _ _ _, Series of 2011

RESOLUTION ADOPTING THE AMENDED RULES ON THE

DEFINITION AND BOUNDARIES OF CONNECTION ASSETS FOR
CUSTOMERS OF TRANSMISSION PROVIDER

WHEREAS, on May 23, 2006, the Energy Regulatory Commission (ERC)

adopted Resolution No. 25, Series of 2006 providing for the "Definition and

Boundaries of Transmission Connection Assets";

WHEREAS, on August 2, 2006, the ERC adopted Resolution No. 41,

Series of 2006 clarifying Resolution No. 25, Series of 2006, particularly on the

term "Connection Assets";

WHEREAS, on January 26, 2009, the ERC adopted Resolution No. 1,

Series of 2009 entitled "A Resolution Adopting the Amendments to the

Guidelines to the Sale and Transfer of TRANSCO's Sub-transmission Assets and

the Franchising of Qualified Consortiums";

WHEREAS, on August 10, 2009, the ERC adopted Resolution No. 18,

Series of 2009 clarifying Resolution No. 01, Series of 2009;

WHEREAS, on various dates, the ERC received inquiries from different

stakeholders as regards its existing policy on the treatment of connection assets;

Resolution No. 16 , Series of 2011
Resolution Adopting the Amended Rules on the Definition and Boundaries
of Connection Assets for Customers of Transmission Provider
Page 2 of 3

WHEREAS, the ERC deems it necessary to issue a Resolution amending

the existing Rules as well as consolidating all its issuances pertaining to Open

Access Transmission Tariffs and Service (OATS) Rules and related sub-

transmission guidelines;

WHEREAS, on June 7, 2011, the ERC posted on its official website at

www.erc.gov.ph the proposed "Amended Rules on the Definition and Boundaries

of Connection Assets for Customers of Transmission Provider" and all interested

parties were given a period until June 15, 2011 within which to submit their

respective comments thereon;

WHEREAS, on June 23, 2011, the ERC conducted a public hearing

intended for the various stakeholders to present their comments/inputs on the

said proposed manual which were considered in preparation for the issuance of

"Amended Rules on the Definition and Boundaries of Connection Assets for

Customers of Transmission Provider";

NOW, THEREFORE, be it RESOLVED, as the ERC hereby RESOLVES

to APPROVE and ADOPT the "Amended Rules on the Definition and

Boundaries of Connection Assets for Customers of Transmission Provider"

hereto attached and made an integral part of this Resolution as Annex "A".

This Resolution shall take effect after fifteen (15) days following the

completion of its publication in a newspaper of general circulation in the

Philippines.

(
Resolution No. 16 , Series of 2011
Resolution Adopting the Amended Rules on the Definition and Boundaries
of Connection Assets for Customers of Transmission Provider
Page 3 of 3

Let copies of this Resolution be furnished the University of the Philippines

Law Center-Office of the National Administrative Register (UPLC-ONAR), the

National Transmission Corporation (TRANSCO), the National Grid Corporation of

the Philippines (NGCP), the National Power Corporation (NPC), all distribution

utilities and all customers of the transmission provider.

Pasig City, July 6, 2011.

'I> A, ( ~
DA ~- CRUZ-DUCUT
Chairperson~

~
~17:<~
R~UF A. TAN
Commissioner

(On Leave)
MARIA TERESA A.R. CASTANEDA
Commissioner
 ANNEX "A"

AMENDED RULES ON THE DEFINITION AND BOUNDARIES OF

CONNECTION ASSETS FOR CUSTOMERS OF TRANSMISSION
PROVIDER

1.0 Purpose

The Energy Regulatory Commission (ERC) regulates the transmission wheeling

rates through its promulgation of the following regulatory documents, including
approved updates from time-to-time:

a) The Rules for Setting Transmission Wheeling Rate ( RTWR);

b) The Open Access Transmission Service Rules (OATS Rules); and

c) The Rules for the Approval of the Sale and Transfer of TransCo's
Subtransmission Assets and the Acquisition by Qualified Consortiums, as
amended.

The definition of the Connection Assets for Customers of Transmission Provider is

required to delineate a sub-category of assets owned by the National Transmission
Corporation (TransCo) and/or the National Grid Corporation of the Philippines
(NGCP) which affects the charging arrangements of Transmission Provider. This
definition has a significant impact on the outcomes of these regulatory documents,
and hence on Customers of Transmission Provider.

The definition of Connection Assets for Transmission Provider in no way lessens the
obligations of TransCo under Section 8 of the Electric Power Industry Reform Act of
2001 (EPIRA), to sell the Subtransmission Assets to Qualified Buyer.

The Transmission Connection Services are separately identified for charging

purposes in the OATS Rules, as amended. For this reason the Commission deems
that its policy position on the definition of the Connection Assets for Customers of
Transmission Provider which provide Transmission Connection Services clarified as
follows:

2.0 Definition of Terms

When used in this Rules, the following terms shall have the following meanings:

Connection Assets (CA): Those assets that are put in place primarily to connect a
Customer/s to the Grid and used for purposes of Transmission Connection Services
for the conveyance of electricity which if taken out of the System, will only affect the
Customer connected to it and will have minimal effect on the Grid, or other
connected Customers.

-I -
Connection Point: The point of connection of a User System or Equipment to the
Grid.

Customer: A person whose User System or Equipment is directly connected to the

Grid and who purchases or receives, or who is seeking to purchase or receive,
Regulated Transmission Services. For the avoidance of doubt, this may include a
person who operates a Generation Facility, a Distribution Utility, a Retail Electricity
Supplier or an End-user subject to the Commission's decisions. In addition, and
notwithstanding the foregoing, a Customer includes an Embedded Generator (as
that term is defined in the Philippine Grid Code) in so far as that Embedded
Generator purchases or receives, or is seeking to purchase or receive, the
Regulated Transmission Services referred to in paragraphs (e) or (g) of the definition
of "Regulated Transmission Services".

Equipment: All apparatus, machines, conductors, etc. used as part of, or 1n

connection with, an electrical installation.

Facilities: A generic term describing the apparatus, Equipment, buildings and

necessary supporting resources for the generation, transmission, supply, sale,
ancillary support, and consumption of Electricity.

Generation Plant: A facility, consisting of one or more Generating Units, where

electric Energy is produced from some form of Energy by means of a suitable
apparatus.

Grid: The high voltage backbone system of interconnected transmission lines,

substations and related facilities, located in each of the island groups of Luzon,
Visayas and Mindanao, or as may otherwise be determined by the ERC in
accordance with Section 45 of the EPIRA, together with such Subtransmission
Systems as are connected to that System and are owned and operated by the
Regulated Entity.

National Grid Corporation of the Philippines (NGCP): The Concessionaire for the
Philippines Grid as provided for under Republic Act No. 9511, with an exclusive
national franchise for the operation, maintenance and expansion of the Grid.

National Transmission Corporation (TransCo): The Corporation organized

pursuant to RA No 9136 to acquire the transmission assets of the National Power
Corporation (NPC).

Regulated Entity: Collectively, any entity or entities who provide any Regulated
Transmission Services. For purposes of these Rules, this shall refer to TransCo and
its Concessionaire/s, who is currently National Grid Corporation of the Philippines
(NGCP).

Regulated Transmission Services: The following services:

(a) the conveyance of electricity through the Grid and the control and monitoring
of electricity as it is conveyed through the Grid (including any services that

-2-
 support such conveyance, control or monitoring or the safe operation of the
Grid);
(b) the planning, maintenance, augmentation and operation of the Grid;
(c) the provision, installation, commissioning, testing, repair, maintenance and
reading both of meters that are used to measure the delivery of electricity to
Customers and of other meters that are used (for the purposes of the WESM)
to measure the flow of electricity into or through the Grid;
(d) until the commencement of the Second Regulatory Period, Transmission
Connection Services;
(e) the provision of Ancillary Services that are provided using assets which form
part of the Grid1 (excluding any such Ancillary Services to the extent they are
provided to the System Operator under contract or through a spot market
established under the WESM Rules);
(f) billing, collection and customer service for Customers purchasing (or seeking
to purchase) any of the services referred to in paragraphs (a), (b), (c) and (e)
and for persons purchasing (or seeking to purchase) any Transmission
Connection Services; and
(g) those services provided by the System Operator under the Philippine Grid
Code, the Philippine Distribution Code or the WESM Rules in its capacity as
such,but do not include such of these services as are determined by the ERC
to be contestable.

Residual Subtranmission Assets: Refers to the subtransmission assets as

identified in the ERC "Rules for Approval of the Sale and Transfer of TransCo's
Subtransmission Assets and the Acquisition by Qualified Consortium or Juridical
Entity", as amended, less any asset defined as Connection Asset and less any asset
that is no longer owned by the Transmission Provider or that has been reclassified
as a transmission asset by resolution of the ERC.

Single Mechanical Connection: Refers to the three discrete joints, each joint
between two electrical Components in a single phase of a three phase electrical
System. Usually all three joints are within close proximity, between similar electrical
Components, but each in a separate phase of the three phase circuit.

System: Refers to the Grid or the Distribution System or any User System. Also a
group of Components connected and associated in a fixed configuration to perform a
specified function.

Step-Down Transformer: An electrical device or Equipment that converts voltage

and current from one level to another, where the output at the Customer side of the
Transformer has a lower voltage than the input at the Grid side of the Transformer.

TransCo: National Transmission Corporation

Transmission Connection Services: The following services:

(a) the provision of capability at a Connection Point to deliver electricity to or

take electricity from the Connection Point;

1
An example of such Ancillary Services is services provided by a series reactor or a static var compensator.

0
- J -
 (b) the conveyance of electricity:
(i) from the User System or Equipment of a Customer to the Connection
Point; or
(ii) from the Connection Point to the User System or Equipment of a
Customer;
(c)the planning, installation, maintenance, augmentation, testing and operation
of Transmission Connection Assets; and
(d) the provision of services that support any of the services referred to in
paragraphs (a) to (c).

Transmission Provider: The TransCo or its Concessionaire with the exclusive

national franchise for the operation, maintenance and expansion of the Grid, as
provided for in Republic Act No. 9511. For the avoidance of doubt, the Transmission
Provider includes the System Operator.

User System: Refers to a System owned or operated by a User of the Grid or

Distribution System.

3.0 Functionality

Connection Assets are those facilities which, if taken out of the System, will only
affect the Customer connected to it and will have minimal effect on the Grid, or other
connected Customers.

Residual Subtransmission Assets are those Subtransmission facilities shared by two

or more connected customers; or Subtransmission facilities which if taken out of the
System, will also affect other Customers connected to it.

4.0 Boundaries

4.1 Connection Assets and Residual Subtransmission Assets for Load

Customers of Transmission Provider

The CAs and RSTAs for Load includes all assets as follows:

a) Connection Assets - assets from the last Single Mechanical

Connection of a User System or Equipment of a Customer, at its
Connection Point, to the last Single Mechanical Connection which is
not shared with another Customer within the Grid.

b) Residual Subtransmission Assets - assets from the last Single

Mechanical Connection which is shared with another Customer within
the Grid to the last Single Mechanical Connection of a User System
or Equipment of a Customer at its Connection Point.

- 4-
 The specific assets which are owned by any Load Customer and the
Connection Assets and Residual Subtransmission Assets which meet
these boundary conditions are shown in Annex B.

4.2 Connection Assets for Generation Customers of Transmission

Provider

Connection Assets for Generation Customers of Transmission Provider

include those assets from the last Single Mechanical Connection of a User
System or Equipment of a Generator, at its Connection Point, to the last
Single Mechanical Connection which is not shared with another Generator
within the Grid.

The specific assets which are owned by any Generation Customer and the
Connection Assets which meet these boundary conditions are shown in
Annex C.

A generation company may develop and own or operate a dedicated point-

to-point limited facilities provided, that such facilities are required only for
the purpose of connecting to the transmission system, and are used solely
by the generating facility, subject to prior authorization by the ERG.

5.0 Inclusions

The Connection Assets for Customers of Transmission Provider shall include:

• The power circuit breaker(s), surge arrester(s), disconnect switch(es)

including Numerical Distance Relays, Break Failure Relays or any other
multi-function protective devices and Equipment as prescribed and
required in the Philippine Grid Code or mechanical connection just prior to
the connection point which is not shared by another Customer.

• The power circuit breaker(s), surge arrester(s), disconnect switch(es)

including Numerical Distance Relays, Break Failure Relays or any other
multi-function protective devices and Equipment as prescribed and
required in the Philippine Grid Code or mechanical connection just prior to
the shared network asset which is used to isolate the shared network from
the unshared Equipment servicing one Customer.

• Load end step-down transformer serving only one (1) customer or two (2)
or more the same customers.

• Dedicated point-to-point limited facility of a generation company.

-5-
6.0 Exclusions

The Connection Assets for Customers of Transmission Provider shall exclude:

• Communications Equipment, SCADA, and other Equipment used for

System Operations.

• Meters and metering Equipment used for Supply and Metering Services.

• Step down transformers within the Grid, which is not associated with one
or particular set of load customers.

• Residual Subtransmission Assets.

• Load end step-down transformer serving two (2) or more different

customers.

• The power circuit breaker(s), surge arrester(s), disconnect switch(es)

including Numerical Distance Relays, Break Failure Relays or any other
multi-function protective devices and Equipment as prescribed and
required in the Philippine Grid Code or mechanical connection at the
primary side of the step down transformer which is not shared by another
Customer.

7.0 Transitory Provisions

Consistent with the "Rules for the Approval of the Sale and Transfer of TransCo's
Subtransmission Assets and the Acquisition by Qualified Consortiums or Juridical
Entity", as amended, residual subtransmission assets connecting two or more
Distribution Utilities which have not been sold, disposed or filed with the ERC for
approval of sale by December 31, 2011 shall be reclassified as transmission network
assets and reverted back to Transmission Provider's Regulatory Asset Base (RAB)
to be recovered consistent with the Open Access and Transmission Service (OATS)
Rules.

8.0 Effectivity

This Rules shall take effect within fifteen (15) days from its publication in a
newspaper of general circulation.

Moreover, this Rules shall apply only to all prospective projects that have not yet
been approved by the Commission for both Transmission Provider and Distribution
Utilities.

-6-
BUS -IN CONNECTION ANNEX B

Substation A

t-------'~
Customer 1
•

I
Line extension to
Portions of the
originally existing
Transmission Line
Connection Point connect the bus-
in substation connecting
Substations A & 8

Customer 2
1---\----, /
Substation 8

LEGEND:

Transmission Asset
- - - Connection Asset

-I -
CUT- IN CONNECTION

Substation A

Customer 1

1-------'~

Connection Point
I
Line extension to
Portions of the
originally existing
connect the cut-in Transmission Line
\bstation connecting
Substations A & B

/
Customer 2

Substation B

LEGEND:

Transmission Asset
Connection Asset

-2-
TAP CONNECTION

Connection Point

}'1 '-- ~-- --r ---- '\r - --- Customer

Load End Substation

Transformer

LEGEND:

Transmission Asset
Connection Asset

1
- 0 -
FEEDER CIRCUIT CONNECTION

LEGEND:

Transmission Asset

Connection Asset
Residual Subtransmission Asset
(if C1 not same as C2 and C3)
Connection Asset
(if C1 same as C2 and C3)

I """ \
'f--)
\ ~ _., ~ Connection Point

f~~~- -J
- '-/ - '-/ - '-/
69kV switchyard

( ( (
1-
I
1-' '
1-
I I I
I I I-, I I I
~
~

) ) J
/--, /--,-

I I I

1
Customer 1
1
Customer 3
1
Customer 2

- 4-
MULTIPLE LINE CONNECTIONS
LEGEND:

Transmission Asset
Connection Asset
Residual Subtransmission Asset
(if C1 not same as C2, C3, and C4)

Connection Asset
(if C1 same as C2, C3, and C4)
Customer 3

i
-,
I
I' Connection Point
,_I
I
/_

69 kV line I
~ ,_
r - ___ - - __/,~,.__.,
7 ' \_
1
_
I 1
r j - l-1k-
- '<
I I
I
-,
I Customer 4
I' I'
,_I ,_I
I Connection Point I

'r
Customer 1
'r
Customer 2

-5-
 ANNEXC

Diagram 1: Asset Boundary for Switchyards using the

Radial scheme for Generation Customers

Protection, Metering
and Telecom
Equipment
p p

M M

TC TC

_[-
_
Disconnect
Switch with
Disconnect
Switch
Disconnect
Switch with
r7 Disconnect
Switch
Earthing Earthing

Power Circuit Power Circuit

Breaker Breaker

Disconnect Disconnect
Switch Switch

230kVBusbar ------~----------Mm----------------------~-----
__ ..,_., Disconnect
Disconnect
' '
•••
Switch
Switch

Power Circuit Power Circuit

Breaker Breaker

.••• ' . , ... L..,,

'
-
:~ .. .... :.: 13.8 kV/230kV ' '
: ...... , I
~ ,, 13.8 kV/230kV

.....
I

'
"',. -"'

,...."' '
I
'
Power
Transformer . ..... ,'
I "' .. ., .. "",

".. ...
Power
Transfonner

• •
•• ••
• •

LEGEND:
8
Transmission ,4sset
8
Connection Asset

-I -
Diagram 2: Asset Boundary for Switchyards using the Ring Bus
scheme for Generation Customers

p Protection, p Protection,
Metering and Metering and
Telecom Telecom
Equipment M Equipment
M

TC TC

Disconnect
Switch with Disconnect Power Circuit Disconnect Disconnect
Earthing -=- Switch Breaker Switch Switch with
Earthing

Disconnect Disconnect Disconnect

Switch Disconnect
Switch Switch
Switch

Power Power
Circuit Circuit
Breaker Breaker
Power Circuit
Breaker
230 kV
Busbar
•
Disconnect ... ·'-;' Disconnect Disconnect .....•• ...' Disconnect
Switch ~ Switch Switch ( Switch
•
il 13.8 kV/230kV
Power
il 13.8 kV/230kV
Power
... Transformer
... Transformer
' '~
......... ' .... '
,,
.....,..,
" .. -"'I

•
' .
~
41" ........ ,

.... ,. ...'
•• ••
•
® ®
LEGEND:
Transmission Asset
Connection Asset

-2-
Diagram 3: Asset Boundary for Switchyards using the 1 % Circuit-
Breaker Scheme for Generation Customers

p Protection, p Protection,
Metering and Metering and
Telecom Telecom
Equipment M Equipment
M

TC TC

Disconnect Disconnect 230 kV Bus bar A Disconnect

Switch with Switch Switch with
Earthing Earthing
Disconnect
Switch

Power Circuit
Breaker
Disconnect
Switch

Disconnect Switch Disconnect Switch

Power Circuit Power Circuit

Breaker Breaker

Disconnect Switch Disconnect Switch

j--------------------
Disconnect Switch Disconnect Switch

Power Circuit Power Circuit

Breaker Breaker

Disconnect Switch Disconnect Switch

'' -•-~-

• •
'' ''
230 kV Bus bar 8

'
,,•- '
,,-.; 13.8 kV/230kV 13.8 kV/230kV ,' ',
Power ,. ..~
·-'
........
~'"-"; Power
Transformer 1 " . . '
"' ... ,." Transformer ..... ,.. "
' '
'' '
@) @)
LEGEND:
Transmission Asset
Connection Asset

-3-
Diagram 4: Asset Boundary for Switchyards using the 1 'I> Circuit
Breaker scheme for Generation Customers

Protection, p Protection, p
Protection,
p
Metering and Metering and Metering and
Telecom M
Telecom M Telecom M
Equipment Equipment Equipm-ent
TC TC TC
230 kV Busbar A

Disconnect Switch

Power Circuit
Breaker

Disconnect Switch

Disconnect Switch Disconnect Switch

Power Circuit Power Circuit

Breaker Breaker

Disconnect Switch Disconnect Switch

Disconnect Switch

Power Circuit
Breaker

230 kV Busbar 8
p p p

M
Protection,
M
.
... -~. 13.8 kV/ M
Protection, ~ .. ·:! 230kV Power Protection,
Metering and and Metering and
Telecom
Equipment
TC Telecom
Equipment
TC ~
.
\ ·- ,' Transformer
TC Telecom
Equipment
..•
Disconnect Switch -~~

.
'
~ Po~~:."J1~~ii
LEGEND:
Power Circuit Transmissi0n Ass'! I

.
~
Disconnect Switch Breaker Connection Asset
~--
:•---,,,
,...-,,_~...
~--,
;..
'--- -- .... '··------+Customer
" • } . '• .-' I '!
13.8 kV/69kV Power Disconnect Switch
Transformer

-4-
Diagram 5: Asset Boundary for Switchyards using the 1 '!. Circuit
Breaker scheme for Generation Customers

p p
Protection, Protection,
Metering and Metering and
Telecom Telecom
M M
Equipment Equipment

TC TC

230 kV Bus bar A

Disconnect Disconnect
Switch Switch
Power Circuit Power Circuit
Breaker Breaker
Disconnect Disconnect
Switch Switch
Disconnect
Disconnect
Disconnect Switch Disconnect
Switch
Switch with Power Circuit Power Circuit Switch with
Earthing Breaker Power Circuit Earthing
Breaker
Breaker
Disconnect Switch Disconnect
Switch
Disconnect Disconnect -----------------,
~;:r [)iscol1n<!ct Switch
Switch Switch
Power Circuit Power Circuit Power Circuit
Breaker Breaker Breaker
•
- J .. , -~-,
Disconnect Disconnect Disconnect Switch •
•

•.··-
I I
Switch Switch
I
•
Iii• 230 kV Bus bar B

-·- I

:c• ....;:• 13.8 kV/ 13.8 kV/ ' ,

' .... .
' ...• . 230kV Power
Transformer
--
230kV Power ~ .. "';:
Transformer "' .. ,.. /

• Start-Up/

@ Stand-By
Transformer

LEGEND:

Transmission Asset
Connection Asset

- 5-