ERC enforces moratorium on delayed FIT payments

 Published May 4, 2021, 5:34 PM by Myrna M. Velasco

https://mb.com.ph/2021/05/04/erc-enforces-moratorium-on-delayed-fit-payments/

 

Renewable energy (RE) companies had been enforced with a moratorium, so they will not demand for penalty or interest payments on any delayed settlements of the feed-in-tariff (FIT) incentives that fund administrator National Transmission Corporation (TransCo) will be paying them.

In an advisory, the Energy Regulatory Commission (ERC) decreed that “during the period of the moratorium, eligible RE plants shall not impose any interest or penalty for any partial or delayed payment of the actual FIT revenue to them by Transco.”

The moratorium, according to the ERC, shall be imposed “for six billing periods from the relevant billing period wherein the interest or penalty had first been incurred, if such moratorium has not yet been in place.”

The ERC stipulated that the advisory it issued on April 29 this year was anchored on Section 9.1 of Resolution No. 16 Series of 2010, or the FIT Rules that the regulatory body enforced more than a decade ago.

It was last month when TransCo cautioned players in the RE sector that the FIT fund was already inching close to depletion, because of regulatory lag on the approval of the FIT rate adjustments by the ERC.

The RE developers qualified to receive FIT payments from TransCo are those that had been endorsed and approved by both the Department of Energy (DOE) and the ERC to receive such perks –based on the completion of their projects when such fixed tariff incentives had been subjected by the government to a race in the years 2014 to 2016.

In a virtual stakeholder consultation that the FIT fund administrator had undertaken last month, TransCo President and CEO Melvin Matibag sounded off that “the delay in approval of the FIT-Allowance rate application may potentially lead to the depletion of the FIT-All Fund.”

In that forum, the TransCo chief executive emphasized that there’s a need “to stabilize the FIT-All fund to minimize, if not eliminate, delays by exploring the possibility of tapping the RE Trust Fund,” as prescribed under the Renewable Energy Act.

The RE Trust Fund shall be collected and managed by the energy department, and that was intended to enhance greater use of RE resources.”

Matibag noted then that “TransCo will request DOE to be granted access to the RETF (RE Trust Fund) of the RE Law for the sustainable administration of the FIT-All Fund.”

TransCo similarly laid down the possibility of using its corporate funds as FIT fund administrator, for the settlement of FIT payment to RE developers, but such shall be subject to interest charges in compliance to government rules for the use of funds that are under the charge of government-owned and controlled corporations.