by Lenie Lectura, 04 May 2015
THE Department of Energy (DOE) has awarded 648 renewable-energy (RE) contracts seven years after the Renewable Energy Act of 2008 was enacted into law.
As of end-March this year, the agency said these contracts have a potential generation capacity of 10,632.22 megawatts (MW), as against a total installed capacity of 2,752.20 MW.
Of the 648 RE projects awarded by the government, 402 are hydropower; 70, solar; 50, wind; 44, biomass; 41, geothermal; and six, ocean energy. These 613 contracts were awarded for grid use.
On top of these, there were 35 RE contracts awarded for self-generation of electricity for their own use. These include one each for hydro and wind; 11 for solar; and 22 for biomass.
The latest DOE data also showed that there are 166 pending RE projects, 117 of which are hydro; 29, solar; four, ocean; five biomass; six, wind; and four are geothermal. The potential generation capacity of these pending RE projects could reach 1,493.78 MW as against an installed capacity of 697.80 MW.
Under the National Renewable Energy Plan, the DOE aims to increase the country’s RE generation to 15,304 MW by 2030.
The DOE has already streamlined the process of RE applications, from two years down to just 45 days, to ensure that RE developers and investors will have an easier time in applying for RE service contracts.
To promote the use of RE on a larger scale and to attract new investments for RE facilities, the government is banking on the feed-in-tariff (FIT) system.
FIT is a premium rate paid for electricity fed into the electricity grid from a designated renewable electricity-generation source, like solar energy system or wind power plant.
Approved by the Energy Regulatory Commission in July 2012, the FIT rate in the Philippines is considered to be one of the lowest in the world. The impact of FIT to the electricity rate, estimated at two centavos per kilowatt-hour, is marginal, compared to the expected increase in the cost of traditional fossil fuels, like coal, in the coming years. This is the reason the DOE pushed for the increase of the installation target for solar, from 50 MW to 500 MW.