By Victor V. Saulon, March 26 2019; Business World

Image Credit to Business World

THE ENERGY REGULATORY COMMISSION (ERC) has approved a feed-in tariff allowance (FiT-All) of P0.2226 per kilowatt-hour (/kWh) applied to the year 2018, P0.0706/kWh lower than the rate applied for by state-led National Transmission Corp. (TransCo).

In a statement on Monday, the regulator said the approved rate reflects a P0.0337/kWh reduction from the current P0.2563/kWh FiT-All rate.

“The variance is attributed to the discrepancy in the plant capacities used by TransCo and ERC in computing for the FiT-All, among others,” ERC Chairperson and Chief Executive Officer Agnes VST Devanadera said.

She said the regulator made use of the capacity of FiT-eligible plants with approved certificate of compliance, while TransCo used projected FiT-eligible plants for 2018. TransCo’s projection included plants with nomination from the Department of Energy, she added.

“There are other diverging factors, such as the FiT rates and the cost recovery rate, that contributed to the discrepancy in the FiT-All computation,” Ms. Devanadera said.

FiT-All, a uniform charge in pesos per kilowatt-hour, is payable by all electricity users that is calculated and set annually. Distribution utilities, system operator National Grid Corporation of the Philippines, and retail electricity suppliers serve as collecting agents.

The proceeds go to the FiT-All fund, which is being administered by TransCo.

The FiT-All mechanism was established under Republic Act. No. 9513, or the Renewable Energy Act of 2008, which aims to spur development of emerging renewable power sources such as wind, solar, run-of-river hydropower and biomass.

Ms. Devanadera said the new FiT-All rate will be charged to all on-grid consumers supplied with electricity through the distribution or transmission network starting on the immediately succeeding billing period after TransCo’s receipt of the ERC decision.

She said the reduction in the FiT-All would mitigate the impact of the impending increase in basic electricity rates due to the expected rise in demand and dwindling power supply in the coming dry months.

In a mobile phone message sent to reporters, ERC Spokesperson Floresinda B. Digal said the new rate could be reflected in the electricity bill in April or May. She added that the 2018 FiT-All is good until a new rate is determined by the ERC. TransCo has a pending application for a rate of P0.273/kWh for 2019.

Melvin A. Matibag, TransCo president and chief executive officer, said last week that the company had amended its application for the current year to reflect a lower rate of P0.24/kWh as it was able to update its payment backlog to renewable energy developers. — Victor V. Saulon