Solar power proponents buck ceiling

Manila Times.net

BY EUAN PAULO C. AÑONUEVO REPORTER

RENEWABLE energy developers are dismayed over the government’s decision to cap solar projects that would be covered by tariff incentives.

Ramon Abaya, Philippine Solar Power Alliance (PSPA) chairman, said the government should not ignore solar power projects that could bring immediate relief to the country’s power woes, particularly in Mindanao.

”Solar energy offers immediate relief in mitigating productivity losses, economic slowdown, and quality of life degradation brought by brownouts. Sadly, solar power is ignored and its promise not fully appreciated by policymakers,” said Abaya, who is also Cagayan Electric Power and Light Co. Inc. president.
Department of Energy records show that 44 solar projects that would generate a combined 420 megawatts applied for service contracts as of last month. A large number of these projects will be located in Mindanao, particularly in the provinces of Davao, Zamboanga, Misamis and in the city of Cagayan de Oro.

The National Renewable Energy Board (NREB), however, is pushing for only 100-megawatts of solar installation for the next three years.
This means that only solar projects that have been put up within the 100-megawatt target can avail of feed-in-tariff (FIT) incentives for renewable energy projects. Once approved by the Energy Regulatory Commission
(ERC), the FIT will be charged against consumers to guarantee renewable energy developers’ returns.

Pedro Maniego Jr., NREB chairman, earlier said the government had to carefully weigh the installation targets of renewable energy projects because of the FIT’s potential impact on power rates.
”The NREB must be very careful in setting installation targets especially for the higher cost technologies like wind and solar. According to [World Bank] consultant Leonardo Lupano, Spain had to drastically reduce the solar FIT rates and institute installation caps when three gigawatts of solar were installed within one year,” Maniego said.

But the PSPA, which is clamoring for at least a 235-megawatt solar installation target, said that NREB did not take into consideration the increases borne by households and business because of an oil price hike.

Based on a comparative study conducted by the lobby group on the generation cost in Mindanao, renewable energy serves as buffer to rising bunker fuel prices. ”If not for hydroelectric power, as well as solar consumers would have paid an increase of as much as P1.84 per kilowatt-hour in 2004, P0.98 per kilowatt-hour in 2009, and P0.57 per kilowatt-hour in 2010 primarily due to rising prices of bunker fuel,” said Tetchi Capellan, PSPA president.

By mixing fossil fuel with reneswables, “the generation cost in Mindanao dropped. Utility companies are able to reduce electricity prices as blending power allowed companies to charge less,” she added.

NREB is scheduled to submit the FIT to the ERC on May 15.