Europe-PH News

Renewable Energy Pricing Nears Implementation

July 30, 2012

Danessa O. Rivera

Europe-PH News

Energy Undersecretary Jose M. Layug, Jr. said in a phone interview that mechanisms which include net metering rules, renewable portfolio standard (RPS) and eligibility criteria for RE developers are already in the final stages for the full implementation of Republic Act 9513 or the RE Act of 2008.

“The Department of Energy... needs to make sure that we complete the other RE mechanisms. All renewable energy (RE) mechanisms should be put in place to fully implement the Philippine Renewable Energy Act of 2008 or Republic Act 9513,” Mr. Layug said.

The National Renewable Energy Board (NREB) has already submitted the net metering rules for the consideration of the Energy Regulatory Commission (ERC) while the RPS and eligibility criteria is being finalized by the Energy department, Board Chairman Pete H. Maniego, Jr. said in a text message.

“It’s not too late [to approve the RPS]. RPS, according to Philippine Electricity Market Corp., is a prerequisite before the RE Market (REM) rules [are created]. If there’s no RPS, you cannot implement the law because you do the REM rules for rating RE certificates,” Mr. Layug said.

When asked for the time line of the other renewable energy mechanisms, Mr. Layug said the Energy secretary will announce the RPS and eligibility criteria, while the ERC will make the announcement for the net metering rules in the coming weeks.

Last Friday, the ERC approved the feed-in tariff (FIT) rates for wind, biomass, hydro and solar renewable energy sources.

“We are hoping that we can move forward because all our developers, even the banks, have been waiting for the FIT. Now whether there will be a project or not, it all depends on the developers,” Mr. Layug said.

He noted that the installation will not be bid out because the government has the rates and installation targets.

“There’s no bidding because we now have the FIT rates. We will have a set of eligibility criteria so we will now see who qualifies based on the criteria we have. The only challenge is if we are oversubscribed,” he said.

“For solar [energy] we have 50 megawatts (MW), for hydro and biomass we have 200-MW, and for wind we have 200-MW. That’s not a cap but our basket of RE projects that will be entitled to those FIT rates. Anyone who wants to proceed and who don’t want to rely on FIT rates, may do so,” he noted.

Mr. Layug said the commission said the FIT rates are subject for review if no one will bid or a lot of developers will express their interest.

“So it’s either too low, or too high, or it’s just right. We will be testing that now depending on the number of developers who will declare commercial [interest],” he said.

However, Mr. Maniego said the board has not received the commission’s decision showing basis for approved rates. “According to wind and solar developers, they have to evaluate if their projects will be viable under their respective FITs,” he said.

The European Chamber of Commerce of the Philippines (ECCP) welcomes the approval of FIT rates, its Executive Vice President Henry J. Schumacher said in a phone interview. “The biomass people will be happy. The wind guys will not be very happy but they can make it work. Now, for the solar people, they are very unhappy because rate is too low and might invest some place else,” he said. -- Danessa O. Rivera


Source: Business World; The Economy; 31 July 2012



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