NREB targets DBP as agent for renewable-energy projects

BUSINESS MIRROR

MONDAY, 11 JULY 2011 19:37 PAUL ANTHONY A. ISLA / REPORTER

POWER producers are currently suggesting to the government to tap instead a state-run financial institution to be the settlement agent and fund administrator of the proceeds feed-in tariff (FIT) to be collected from consumers.

In an interview, Ernesto Pantangco, Philippine Independent Power Producers Association president, told reporters that industry players prefer to have a government financial institute to manage the FIT proceeds.

The FIT refers to a fixed rate guaranteed to renewable-energy developers over a period of time.

Under the Energy Regulatory Commission’s (ERC) FIT Rules, the FIT proceeds will be handled or managed by the National Grid Corp. of the Philippines (NGCP).

Pantangco, who is also a director of the National Renewable Energy Board (NREB), pointed out that the NGCP is a private entity.

While the ERC rules say that the settlement agent for the FIT is NGCP, Pantangco said there have also been some questions raised pointing out that these are public funds to be collected from consumers and will be managed by NGCP.

Pantangco said the NREB has sought the Office of Government Corporate Counsel’s (OGCC) legal opinion on whether they could appoint the Development Bank of the Philippines (DBP) as the FIT’s fund administrator.

Apart from DBP, Pantangco said another option is to tap as fund managers either the Philippine Electric Market Corp. (PEMC) or Power Sector Assets and Liabilities Management Corp. (PSALM).

“We’re getting a legal opinion from OGCC that the alternate option is to get PEMC or PSALM to administer the funds. The fund is being held by DBP. But the settlement agent will collect from consumers and disburse to the renewable-energy investors, which can be either PSALM or PEMC,” Pantangco said.

He quickly added though that they consider DBP as the better option to handle the FIT proceeds as this may result in savings.

“We even told DBP why not be the settlement agent in order to reduce fees. We’re hoping and telling DBP to be the administrator to lower the administration and processing fees. But we still need that legal opinion from OGCC,” Pantangco said.