Lower subsidy for solar eyed

by Alena Mae S. Flores, February 12, 2015
from Manila Standard Today

LAOAG CITY—The National Renewable Energy Board has proposed a lower subsidy rate on new solar energy projects.

NREB vice chairman Ernesto Pantangco told reporters the board was looking at a feed-in tariff rate of below P9.10 per kilowatt-hour for the additional 450-megawatt solar installation.

FIT, the fixed cost that would be paid out by consumers for renewable energy such as solar, is higher than the average power generation rate.

“There was a hearing on the solar FIT phase two. Clearly, there seems to be a very strong resistance, I can’t say from whom, because the current thinking of some developers is that either P9.68 or P9.10. The P9.10 is the floor price,” Pantangco said.

The Energy Regulatory Commission is conducting hearings on the appropriate feed-in tariff rate for the 450-MW additional installation for solar projects.  The additional capacity, which was already approved by the Energy Department, will bring the solar installation to 500 MW from the approved 50 MW.  NREB is the implementing agency of the Renewable Energy Act of 2008.

The ERC earlier approved FIT rates as follows: run of the river hydro (P5.90 per kWh); biomass (P6.63 per kWh ); wind (P8.53 per kWh); and solar (P9.68 per kWh).

Pantangco said that during deliberations on the new feed-in tariff rates for additional capacity, there was a resistance from groups on reducing the FIT rate.

“The challenge now is for us to determine what will be a mutually acceptable feed in tariff. It came out, we presented, in the last hearing with the ERC that maybe something below P9.10 per kWh,” he said.

“We did mention a price of maybe something that could be considered by the developers and ERC in their deliberations, of something like P8.95 per kWh,” Pangtangco said.

He said NREB was working with several groups on the appropriate rate.

Pantangco said that if the P9.10 per kWh rate was imposed, the installation target might even exceed 500 megawatts over a two-year period “which is also bad for the FIT-Allowance so it’s got to be something lower.”

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