RE subsidy from power consumers reaches P2B

January 19, 2016

COLLECTION on feed-in-tariff allowance (Fit-All) from January of last year to January 2 of this year reached at least P2 billion, the Energy Regulatory Commission (ERC) said.Fit-All is a subsidy shouldered by power consumers collected by the National Transmission Corp. (Transco) from electricity consumers mandated by the Renewable Energy Act of 2008 (RA 9513). It serves as incentives for renewable-energy (RE) developers to spur the development of green power sources and to guarantee the projects’ financial survival.

The collection is only for the FIT differential and not the full revenues given to the RE developers.

“As of January 2, 2016, Fit-All collections reach at least P2-Billion but this is only for the FIT differential not the full revenues,” Sharon O. Montaner, focal person for RE Technical Working Group, said in last Friday’s ERC’s Continuing Regulatory Education for the Stakeholders (Crest) training for media at the Oakwood Premier Joy-Nostalg Center.

Montaner said that the total FIT differential is the difference between “the forecast applicable FIT rate (on a certain year) that each eligible RE plant is forecasted to receive for each kWh delivered; and the forecast applicable cost recovery rate as determined under the guidelines multiplied by the projected annual energy generation from eligible RE plant (on a certain year).”

Meanwhile, the application of the Transco to collect and additional P0.0406 per kilowatt per hour (kWh) Fit-All payments was approved by ERC and was implemented starting January 2015.

However, Transco proposed and is seeking anew provisional regulatory approval to implement higher FIT-All charge of P0.1025 per kilowatt- hour (kwh) from the previously approved P0.0406 per kWh.

The FIT fund administrator firm said that the “additional capacities qualified under the incentive scheme, calculated under-recoveries and the cost difference of the “avoided technology” as underpinned by average settlement prices in the Wholesale Electricity Spot Market” has resulted in the proposed adjustments.

ERC said that the Fit-All charge of P0.1025 per kWh that is being pushed by Transco is lower compared to the Department of Energy’s (DOE’s) estimated projections on additional installations at P0.1470 per kWh.

According to ERC, Fit system is a fixed rate per kWh for emerging renewable energy sources excluding any generation for own use, the scheme does encourage the construction of more RE plants down the line.

The Wind-power developers are entitled to Fit rate of P8.53 per kWh; solar for P9.68 per kWh; hydro at P5.90 per kwh; and biomass at P6.63 per kWh.

At present, there are some 300 pending RE projects in Mindanao, at least 70 of which are from Davao Region based on the DOE and Mindanao Power Monitoring Committee data

From Sun Star

January 19, 2016

By Ace June Rell S. Perez


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