DoE could cancel over 50 RE deals in first half

Business World Online
Posted on March 12, 2015 08:36:00 PM

OVER 50 renewable energy (RE) contracts will be canceled by the Department of Energy (DoE) within this semester, an official said last week, after making insufficient progress in moving their projects forward.

Mario C. Marasigan, director of the Renewable Energy Management Bureau, said the agency canceled over 100 contracts last year.

“For the first half of this year alone, more than 50 contracts will be canceled,” Mr. Marasigan told reporters in Makati City.

“We will be issuing the show cause order before canceling. Rest assured that they will be given a chance to explain,” said Mr. Marasigan.

Most of these projects, he said, are prospective wind and solar power plants.

The official noted the Energy department since last year has been monitoring progress of RE projects to ensure that the proponents perform their duty.

The cancellations form part of the Milestone Approach, which accelerates the process for contract applications to 45 days from two years to attract more investors to RE development.

If the project proponent fails to move forward within six months, the Energy department cancels the contract.

As of end-January, the department had a total of 622 RE contracts outstanding representing combined capacity of 12,638.35 megawatts.

“At present, the Philippines is harnessing 30% of RE in our energy mix. If we keep it at that level, we will have a secure energy source, even if oil prices go up or if there is a shortage in supply in the international market,” Energy Secretary Carlos Jericho L. Petilla said last year.

“Because RE is indigenous which means it is locally available, we can depend on it for energy security even if there are political issues such as war in other countries,” he added.

Mr. Petilla noted that benefits of RE projects are expected to outweigh the costs. -- Claire-Ann Marie C. Feliciano source