ANNEX A

DEFINITION AND BOUNDARIES

OF
TRANSMISSION CONNECTION ASSETS

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:

b) The Transmission Wheeling Rate Guidelines (TWRG);

c) The Open Access Transmission Service Rules (OATS Rules); and
d) The Connection Charging Policy (CCP).

The definition of the Transmission Connection Assets has a significant impact on the
outcomes of these regulatory documents, and hence on Customers of the National
Transmission Corporation and/or its Concessionaire (TransCo). As such the
Commission requires that its policy position on the definition of the Transmission
Connection Assets which provide Transmission Connection Services clearly defined
and provided as follows:

2.0 Definition

Transmission Connection Assets (TCA) are those assets that are put in primarily to
connect a Customer to the Grid and used for purposes of Transmission Connection
Services for the conveyance of electricity.

(Attachment 1 lists and defines the terms used in the definition and boundaries of
Transmission Connection Assets)

3.0 Functionality

TCA are 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.

4.0 Boundaries

4.1 Transmission Connection Assets for Load

The TCA for Load include all assets:

(i) 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, or which is on the lower voltage terminal of the
closest Step-Down Transformer within the Grid; or
(ii) from the last Single Mechanical Connection which is not shared
with another Customer within the Grid, or which is on the lower
voltage terminal of the closest Step-Down Transformer within the
Grid, to the last Single Mechanical Connection of a User System or
Equipment of a Customer at its Connection Point.
The specific assets which are owned by any Load Customer and the Connection
Assets which meet these boundary conditions are shown in Annex B.

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4.2 Transmission Connection Assets for Generation

The boundaries of TCA for Generating Facilities connected to the Grid are:

4.2.1 For Existing Generation Plant

Existing Generation Plants are those which were under construction, were in
existence, were in service, have been granted a Certificate of Compliance (COC)
by the ERC as a Generation Company, or have applied to the ERC for a CoC as
a Generation Company, as at the date of the Commission’s Resolution adopting
the Transmission Connection Asset definition and boundaries.
Any existing Generation Plant has no TCA beyond their Connection Point to the
Grid.
Ownership and control of such transmission assets or Equipment associated with
each Connection Point or which lie within the Generating Facility are as agreed
and documented under existing contracts between TransCo and the Generating
Facility owner.
In the case of the Generating Facilities owned and controlled by the National
Power Corporation (NPC), a Memorandum of Understanding (MoU) which
defines and identifies the ownership and control of all the transmission assets or
Equipment inside the premises of the Generating Facility at each Connection
Point, should exist. This MoU shall be consistent with PSALM Circular No. 2005-
003, titled “Guidelines in the Determination of Fixed Asset Boundary Between
Generating Facility and TransCo”, dated February 14, 2005.
The ERC shall determine whether or not a Generation Plant is an Existing
Generation Plant if there is a dispute on such classification for the purposes of
the treatment of TCA.

4.2.2 For New Generation Plant

New Generation Plants are those which have not applied to the ERC for a
Certificate of Compliance (COC) as a Generation Company under s.6 of the
Electric Power Industry Reform Act of 2001 (EPIRA) and s.4 of Rule 5 of its
Implementing Rules and Regulations (IRR), as at the date of the Commission’s
Resolution of the Definition and Boundaries of Transmission Connection Asset.
For a New Generation Plant, the boundaries of the TCA are defined in the same
manner as for Load (refer to 4.0 above), and also include those Equipment and
transmission lines which the generation plant requires for connection from the
Connection Point at its generation site to the Grid and which it is willing to fund
as a contributed asset to TransCo (which retains ownership and responsibilities
for operation and maintenance) because TransCo is unable or unwilling to invest
in those Connection Assets at that time.

Any new Generating Plant can choose to install and own its transmission
Facilities (including lines) up to the Connection Point to the Grid offered for
connection by TransCo. Such Connection Point to the Grid must be offered by
TransCo, but excluding connection to such Subtransmission Systems as are
connected to that System and are owned and operated by TransCo.

The ERC shall determine whether or not a Generation Plant is a New Generation
Plant if there is a dispute on such classification for the purposes of the treatment
of TCA.

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 4.2.3 For Expansions to Existing Generation Plants

For the Existing Generation Plants defined in clause 4.2.1 above, any addition of
a Generating Unit which provides additional capacity or increases the Installed
Generating Capacity of the Generating Plant, and which requires incremental
investment by TransCo shall be treated as follows.
The incremental investment between the previously existing Connection Point
and the Grid required to allow full dispatch of that additional capacity, shall be
treated as if it were a TCA for a New Generation Plant as in clause 4.2.2 above.
For clarity, the boundaries of the TCA which arise from this incremental
investment are defined in the same manner as for Load (refer to 4.0 above).
Incremental costs due to augmentation of capacity to remove constraints deep in
the Grid are not included in TCA.

4.2.4 Generation Plant Exclusions

This definition of TCA only applies to Generating Facilities connected to the Grid.
It does not apply to Self-Generation Facilities or Embedded Generating Plants.
The specific assets which are owned by any Grid connected Generation Plant
and by the Regulated Entity are shown in Annex C.

5.0 Inclusions

The Transmission Connection Assets 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 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 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.
• For new Generating Plant, those Equipment and transmission lines
which it requires for connection from the Connection Point at its
generation site to the Grid and which it is willing to fund as a
contributed asset to TransCo (which retains ownership and
responsibilities for operation and maintenance) because TransCo is
unable or unwilling to invest in those Connection Assets at that
time.

6.0 Exclusions

The Transmission Connection Assets 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.

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• Any transmission, sub-transmission or distribution line which is (at
the date of approval of the Connection Charging Policy by the ERC)
shared between or among Customers.
• Contributed Assets paid or partially paid for by Customers. Any
new Generating Plant can choose to install and own its
transmission Facilities (including lines) up to the Connection Point
to the Grid offered for connection by the Regulated Entity. Such
Connection Point to the Grid must be offered by the Regulated
Entity, but excluding connection to such Subtransmission Systems
as are connected to that System and are owned and operated by
the Regulated Entity.
• Where Subtransmission Assets are sold to a DU Consortium
(either a partnership, or joint venture, or single corporation or
entity), such Connection Point for that Regulated Entity shall be
treated as if it were a “shared” Connection Point between two or
more DUs, irrespective of the ownership of that DU Consortium.

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 Attachment “1”

DEFINITION OF TERMS:

The following are the definitions of the terms used in the Definition and Boundaries of
Transmission Connection Assets. The source or original definition of the term is
referenced in parenthesis.

Connection Point: The point of connection of a User System or Equipment to the

Grid. (s1.3 TWRG, s1.6 Grid Code)

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 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 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”. (s1.3 TWRG)

Equipment: All apparatus, machines, conductors, etc. used as part of, or in connection
with, an electrical installation. (s1.6 Grid Code)

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. (A1 OATS)

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. (s1.6
Grid Code)

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. (s1.3
TWRG, and based on Rule 4 IRR)

Regulated Entity: Collectively, any entity or entities who provide any Regulated
Transmission Services. (s1.3 TWRG)

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 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);

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

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 (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 Grid
Code, the 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. (s1.3 TWRG)

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. (s1.6 Grid Code)

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 and/or its Concessionaire.

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;
(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). (s1.3 TWRG)

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

Distribution System. (s1.6 Grid Code)

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 ANNEX B
BUS - IN

Note:
If the step -down transformer is not owned by
the customer , step-down transformer will
form part of the Transmission Assets, as it
will look like a Tap connection.
Substation A
Customer 1

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

Customer 2

M Substation B

LEGEND:

Transmission Asset
Customer Owned
] Connection Asset The Connection Points are assumed for
( if C1 same as C2) this example. Transmission & Connection
Connection Asset Assets are Owned by TRANSCO.
(if C1 not same as C2) Anything owned by the Customer remains
in customer ownership.

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CUT - IN

Note:
If the step -down transformer is not owned by
the customer, step-down transformer will
form part of the Transmission Assets, as it
will look like a Tap connection.
Substation A
Customer 1

Portions of the
Line extension to
M Connection Point connect the bus-
originally existing
Transmission Line
in substation connecting
Substations A & B
Customer 2

M Substation B

LEGEND:

Transmission Asset
Customer Owned
The Connection Points are assumed for this example.
] Connection Asset
Transmission & Connection Assets are Owned by
( if C1 same as C2)
TRANSCO. Anything owned by the Customer
Connection Asset
remains in customer ownership.
(if C1 not same as C2)

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TAP

Last Step-Down Transformer

in the Grid

The Connection Point is assumed for

this example. Transmission &
Connection Assets are Owned by
TRANSCO. Anything owned by the
Subtransmission Customer remains in customer
Line ownership.

Connection Point
M
LEGEND:

Transmission Asset
Customer Owned
Connection Asset

Customer 1

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FEEDER CIRCUIT
LEGEND:

Transmission Asset
Customer Owned
Connection Asset

The Connection Points are assumed

for this example. Transmission &
Connection Assets are Owned by
TRANSCO. Anything owned by the
Customer remains in customer
ownership.

69kV switchyard

Connection Point

Customer 1 Customer 3
Customer 2

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MULTIPLE LINE CONNECTIONS
LEGEND:

Transmission Asset
Customer Owned
Customer 3 Connection Asset

The Connection Points are assumed

for this example. Transmission &
Connection Assets are Owned by Connection Point
TRANSCO. Anything owned by the
Customer remains in customer
ownership. 69kV line

Customer 4

Connection Point

Customer 1 Customer 2

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 ANNEX C

Diagram 1: Asset Boundary for Switchyards using the Radial scheme for
Generation Customers

Power Circuit Breaker

Legend:
Transmission Asset
GENCO Asset

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Diagram 2: Asset Boundary for Switchyards using the Ring Bus scheme for NPC
Generating Plants.

Legend:
Transmission Asset
GENCO Asset

2
Diagram 3: Asset Boundary for Switchyards using the Ring Bus scheme for
NPC-IPP Plants

Legend:
Transmission Asset
GENCO Asset

3
Diagram 4: Asset Boundary for Switchyards using the 1 ½ Circuit- Breaker
Scheme for NPC Generating Plants

Legend:
Transmission Asset
GENCO Asset

4
Diagram 5: Asset Boundary for Switchyards using the 1 ½ Circuit Breaker
scheme for NPC-Generating Plants

Legend:
Transmission Asset
GENCO Asset

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Diagram 6: Asset Boundary for Switchyards using the 1 ½ Circuit Breaker
scheme for NPC-IPP generating plants.

Legend:
Transmission Asset
GENCO Asset