Another round of incentives for solar-, wind-power projects

by Lenie Lectura - May 14, 2016
http://www.businessmirror.com.ph/another-round-of-incentives-for-solar-wind-power-projects/

THE National Renewable Energy Board (NREB) on Friday submitted a recommendation to the Department of Energy (DOE) to implement another round of feed-in tariff (FiT) incentives to developers of solar- and wind-power projects.

“We have already finalized our recommendation to the DOE for the next round of installation targets for solar and wind. It was submitted today [Friday],” NREB Chairman Pedro H. Maniego Jr. said in an interview.

The NREB is the body tasked by the Renewable Energy Act of 2008 to recommend policies, rules and standards to govern the implementation of the law, which granted fiscal and nonfiscal incentives to renewable-energy (RE) projects.

Maniego refused to disclose the content of the board’s recommendation since “the DOE must first evaluate based on the active service contracts and the grid constraints.”

He said the NREB’s primary role is “recommendatory,” following its mandate in the RE Act of 2008.

When sought for comment, Energy Secretary Zenaida Y. Monsada said the possibility there would be a third round of FiT for solar-power projects depends on the NREB’s proposal.

“The NREB’s proposals should include justifications. The proposal should also zero in on the impact because we, at the DOE, are focused on providing consumers reasonable prices. It is up to the proposal of the NREB. Whatever their proposal is, NREB must be able to justify it,” Monsada said.

The DOE highlights that FiT subscriptions for RE resources have significantly increased to 806.82 megawatts (mW) from 646.65 mW installations since the start of 2016. The following are the FiT subscriptions to date: Biomass has 11 power plants with a total capacity of 94.25 mW; hydro has four accounting for 26.6 mW; wind has six accounting for 393.9 mW.

Meanwhile, as of March 15, 2016, the DOE issued Certificates of Endorsement for FiT Eligibility (COE-FiT) to 11 solar-power plants accounting for 292.07 mW to the Energy Regulatory Commission (ERC). More solar-power projects may be issued COE-FiT at the completion of the ongoing validation and assessment of the submissions received by the DOE in relation to the March 15 deadline for the expanded FiT for solar-power projects.

The first tranche of the solar for FiT was at 108.90 mW at P9.68 per kilowatt-hour (kWh), while the second tranche was the remainder for the 500 mW installation target at P8.69 per kWh.

The DOE has yet to release the list of solar providers that made it to the March 15 deadline for the expanded FiT.

For solar, the DOE increased last year the FiT-installation target from 200 MW in the first round to another 200 mW in the second round to 400 mW in total.

For the wind FiT2 rates, the ERC approved P7.40 per kWh, lower by P1.13, from the original rate of P8.53 per kWh.

FiT is one of the policy mechanisms eyed by the DOE, as it aims to maintain the share of RE to at least 30 percent of the country’s power mix.

Under the FiT system, qualified developers of emerging RE sources are offered a fixed rate per kWh of their exported electricity to the distribution or transmission network. This scheme excludes the energy utilized from RE plants eligible for their own use.

Consumers are the ones who shoulder the FiT-Allowance (FiT-All), a separate line component in the power bills. They pay P0.124 per kWh.

The FiT-All serves as an incentive to RE developers to ensure the viability of their projects. RE includes wind, run-of-river hydro, solar, geothermal and biomass.