ERC authorizes transfer of FiT-All component to fund renewable energy firms
Adam J. Ang – April 3, 2020 | 6:42 pm
from Business World
THE ENERGY Regulatory Commission (ERC) on Friday allowed the National Transmission Corp. (TransCo) to draw funds from the Feed-in-Tariff Differential (FD) component of the Feed-in-Tariff Allowance (FiT-All) chest to augment deficiencies in the cost recovery revenue (CRR) sub-account to continue funding renewable energy producers.
This came following the suspension of the FiT-All collection as ordered by the ERC, bringing a power rate cut by P0.04 per kilowatt-hour (kWh) in the next utilities billing cycle.
“This will enable TransCo to make full payments to FiT-eligible RE (renewable energy) developers for the February and March 2020 billing periods,” ERC Chairperson and Chief Executive Officer Agnes Vicenta S. Torres-Devanadera said in a statement.
The ERC earlier told the state-led company to continue its payments of obligations to FiT-eligible power producers, which it claimed would not be affected by the collection halt.
In an interview on March 22, TransCo President and Chief Executive Officer Melvin A. Matibag said there is a “sufficient” balance in the FiT-All fund to help RE developers sustain their operations, “even if no new FiT-All collection comes in for the time being.”
In an order dated March 25, the ERC also told TransCo to ensure that the amount drawn from the CRR account, as supplemented by the FD, should be “equivalent to the amount necessary to address the deficiency for the 05 April 2020 and 05 May 2020 payouts to FiT-Eligible Plants.”
“Transferring of the fund will enable TransCo to still timely pay the RE developers, ensuring therefore that no interests will be incurred, thus avoiding unnecessary burden to the consumers in their electricity bills,” Ms. Devanadera said.
The agency also said TransCo must “immediately” return the amount taken from the FD account upon its collection of the Actual Cost Recovery Revenue (ACRR) from the Philippine Electricity Market Corp. and host distribution utilities.
FiT-All is a uniform charge to all electricity customers, calculated and set annually. It is collected by distribution utilities, the National Grid Corp. of the Philippines, and Retail Electricity Suppliers, while the payments are remitted to the FiT-All fund held by TransCo.
Besides FD and CRR, the FiT-All fund also includes Working Capital Allowance, Administration Allowance, and Disbursement Allowance.
Earlier, an order from the Department of Energy tasked power stakeholders to defer electricity payments within the energy sector to ensure a steady supply of electricity as the country is placed under a state of public health emergency due to the coronavirus disease 2019 (COVID-19) pandemic.
