DOE issues circular on REM I-COP
BY LENIE LECTURA – JULY 18, 2022
from Business Mirror
The Department of Energy (DOE) has released a circular declaring the interim commercial operations (I-COP) of the renewable energy market (REM), the venue for the trading of renewable energy certificates (RECs).
However, the exact date for the commencement of the REM I-COP has yet to be decided by the DOE because the REC price cap has yet to be determined by the Energy Regulatory Commission (ERC).
“The REM I-COP shall not yet involve any financial transaction, until such time that the commercial operations of the REM has been declared by the DOE,” Department Circular 2022-06-0019 stated.
The circular, which was signed by former Energy Secretary Alfonso G. Cusi and issued last June 10, was posted on the DOE website yesterday.
The same circular tasked the ERC to determine and approve the REC price cap and methodology; the rules on the recovery mechanism for the cost of RPS compliance by regulated entities; and the structure and level of market transaction fees for REM within 120 days.
The Philippine Electricity Market Corp. (PEMC) will be in charge of the registration of REM participants and will adjust the issued RECs, as necessary.
“PEMC shall, under the supervision of the DOE, establish and operate the Renewable Energy Registrar (RER) and shall issue, keep, and verify RECs corresponding to energy generated from eligible RE facilities, which shall be used by mandated participants for compliance under the Renewable Portfolio Standards (RPS).”
The agency also released a circular on “Adopting the Guidelines and Procedures in the Fund Sourcing, Accounting, and Audit of the Renewable Energy Trust Fund (RETF).”
The said fund refers to the contribution from government institutions for special account administered by the DOE. It is established to enhance the development and greater utilization of RE.
The guidelines state that the RETF shall apply to the three RETF sources, namely: Collection from RETF contributors; 1.5 percent of the government share collected from conventional energy service contractors; and collection of the DOE on the contributions, grants, and donations, any revenue generated from the utilization of the RETF and proceeds and proceeds from fines and penalties imposed under RE No. 9513.
The said fund shall be used to finance research and development of RE for power and non-power applications; provide funding to qualified research and development institutions engaged in RE studies undertaken jointly through public-private sector partnerships, including a fellowships for energy studies; support the development and operation of new RE resources to improve their competitiveness in the market; to conduct nationwide resource and market assessment studies on the use of RE systems; and propagate RE knowledge to promote RE.
Within three months from effectivity of the circular, the DOE shall issue RETF operations manual, which shall include qualifications of eligible organizations, types of financial support, institutional structures and mechanisms, and application and approval process, among others.
The said circular was also signed by Cusi last June 10.
