NREB looking for best options for ‘errant’ solar power providers

By Lenie Lectura – July 24, 2017 

from Business Mirror

The National Renewable Energy Board (NREB) has created a committee to focus on coming up with the best option on how solar providers who were not able to avail themselves of the feed-in-tariff (FiT) can move forward.

“At the NREB level, we created a committee to create options on stranded solar, on what alternatives could be availed [of],” NREB Chairman Jose Layug Jr. said.

Among the options that could be considered are, “maybe, another round of bidding or public auction, though not necessarily in the form of FiT”. Also, he cited, “a subsidy scheme based on marginal cost so they can continue to operate without shutting down”. The committee, he said, is currently working on the numbers in its proposal before this is presented to the Department of Energy (DOE). “Then we submit this to the DOE for approval,” Layug said.

The NREB is the advisory body tasked for the effective implementation of renewable-energy (RE)projects in the country. The DOE is the agency that crafts the policy for the RE sector. Meanwhile, the Energy Regulatory Commission (ERC) sets the FiT rates.

Under the FiT system, RE developers of emerging renewable sources are offered a fixed rate per kilowatt-hour (kWh) of their exported electricity.

In July 2011 the DOE approved a solar-installation target of 50 megawatts (MW), to which the Energy Regulatory Commission (ERC) granted a guaranteed FiT rate of P9.68 per kWh. When the DOE increased the target in April 2014 to 500 MW, the ERC lowered the rate to P8.69 per kWh.

The new rate is applicable until the target is reached, but only for projects that qualified on March 15, 2016.

However, the installation target was oversubscribed by 390 MW. Energy Secretary Alfonso G. Cusi has already declared that he will no longer allow another round of FiT being sought by RE developers, particularly by solar players that failed to qualify in the second round of solar FiT.  A majority of the “stranded” solar farms without a guaranteed FiT were built in Negros where the transmission facility is unable to handle the new power capacity.

“For the solar developers of the 390 MW excess capacity, you know the rules when you participated. If you don’t qualify, you should know your options…and your options are, either the spot market or bilateral contracts,” Cusi had said.  “That’s enough of the FIT for solar.”