Napocor seeks tariff incentives for off-grid power areas

Manila Times.net
Published : Friday, October 21, 2011 00:00 Written by : EUAN PAULO C. AÑONUEVO


STATE-OWNED National Power Corp. (Napocor) will push for tariff incentives for power producers in off-grid or missionary areas in the country.


Froilan Tampinco, Napocor president, told reporters that the company will file a petition before the Energy Regulatory Commission for feed-in-tariff (FIT) for areas served by unit Small Power Utilities Group (SPUG) and renewable energy (RE) developers who will tie up with the latter.


“We will only consider RE proponents whose generation cost would translate into a net reduction in the existing subsidy. If it will not, then we will not encourage it,” he said.


The areas served by SPUG mostly have limited markets to attract private power producers.


As such, Napocor has had to rely on subsidies sourced from the universal charge for missionary electrification (UCME) component of consumers’ power bills for the former’s operations.


Tampinco, however, said that the FIT would allow the company to attract private power firms, reduce the subsidies and eventually ease out government’s control in SPUG areas.


The Renewable Energy Act of 2008 mandates the establishment of the FIT, or guaranteed rates for proponents of RE projects to help boost the development of green power sources.


Regulators are currently still working on the FIT rates that will be applied to specific RE technologies such as wind, solar, biomass, ocean and hydropower. Once approved, the FIT will be shouldered by consumers like the UCME that subsidizes Napocor’s off-grid operations.