890 MW of solar to push FIT-All rate to P0.27/kwh

By Myrna M. Velasco – October 27, 2016, 10:01 PM

from Manila Bulletin

The country’s “overbuild” of solar farms will correspondingly punish Filipino consumers’ pockets with feed-in-tariff allowance (FIT-All) inflating to as high as R0.27 per kilowatt hour (kwh).

That had been the initial calculation of the Energy Regulatory Commission (ERC), on number crunching set for the 890 megawatts (MW) of solar capacity already in commercial operations. The low end of the estimated FIT-All rate had been pegged at R0.23 per kwh, according to a highly placed source at the regulatory body.

At 500 megawatts of solar, the regulatory body noted that FIT-All could be pushed up R0.18 to R0.19 per kwh, a bit lower than the anticipated R0.20 to R0.24 per kwh FIT-All application set to be lodged by the National Transmission Corporation.

The solar developers are clamoring in a very forceful way that they all be given a share of the FIT incentives – even with them knowing it from the beginning that the race for FIT shall only be capped at 500MW.

Following the second wave of FIT allocations, many “losing developers” cannot accept a government mandate that their ventures could not be afforded the FIT subsidy.

They are now intensely batting for a third round of FIT even at a rate lower than R8.69 per kilowatt hour.  Their argument is anchored on the fact that they already took risks on investments, and for them to honor lender commitments, they rightfully need a pie of the subsidies also.

Beyond the noise, ERC Chairman Jose Vicente B. Salazar is assuring consumers that they will judiciously examine the new FIT-All petition that TransCo will file, especially so since that will entail additional cost impact in the electric bills.

It was similarly gathered that Energy Secretary Alfonso G. Cusi has very strong aversion of increasing the FIT-All charges that shall be passed on to the consumers, that he reportedly wants to guarantee that FIT-ravenous investors could no longer get to their third round.

The Department of Energy (DOE) previously asked the ERC to defer the grant of FIT-certificates of compliance (FIT-COCs) to the solar projects that had been initially qualified and endorsed for FIT availments.

At present, only 292 megawatts of solar had been officially granted FIT-COCs, hence, it is only them that can collect their FIT payments from fund administrator TransCo.

The second solar FIT race placed a ceiling of 500MW on the installations that shall be accorded with the 20-year financial incentives.

But some groups are now fiercely questioning the validation report of the DOE on project completions – allegedly due to lack of transparency on the department’s processes.