NREB seeks capacity limit on wind and solar projects

by Lenie Lectura, 15 July 2015
from BusinessMirror

THE National Renewable Energy Board (NREB) is proposing to put a cap on the capacity of wind and solar projects so the feed-in tariff (FiT) scheme could accommodate as many projects as it can.

NREB Chairman Pedro Maniego said during the Energy Smart Philippines 2015 Conference there is a discussion among the board members to put a 100- megawatt (MW) cap on each wind power project and 50 MW for every solar project.

At present, there is no limit as to how big or small any of the renewable-energy (RE) projects should be. It is the sole discretion of the RE developers to develop as many RE projects as it can with no cap on capacity.

Aside from wind and solar, RE also includes biomass, geothermal, ocean and hydro. Maniego said though that the cap proposal is only for solar- and wind-power projects.

“We want to spread the projects over a wide number and to also increase the people who can pursue the technology later on,” Maniego said.

There is a 500-MW cap in allocation in all solar projects and 400 MW in all wind-power projects.  “There is an existing allocation of 500 MW in solar. Now, if you put a 50-MW cap on per solar project then there will be 10 solar projects. This is what other countries are doing. They don’t want to limit the participants to a small number,” Maniego said.

NREB is the body tasked by the Renewable Energy Act of 2008 to recommend policies, rules and standards to govern the implementation of the law, which granted fiscal and nonfiscal incentives to RE projects.

Maniego said the 15-man board would still deliberate on this. “This is still subject to discussion. Once we have decided on this and approved by the board then we will submit it to the DOE [Department of Energy]. NREB is just a recommendatory body.”

It is the DOE that sets the installation targets for RE projects, while the Energy Regulatory Commission (ERC) decides on the FiT rate. “The DOE is the one implementing the installation targets although we are the one who recommends this to the ERC for the basis of computing the FiT. The implementation and award of commerciality is still the DOE’s. So it’s up to them to come out with the rules in award of installation capacity,” he said.

He expects opposition from wind-project developers given the bigger capacity of current wind projects, as well as those in the pipeline, compared to other RE projects. “There might be some opposition from big developers. For wind, most of the developers are big. But I think 100 MW is already doable,” Maniego said.

The wind projects that have certificates of compliance under FiT are the following: the 150-MW Burgos wind farm of Energy Development Corp.; the 19.8-MW Bangui expansion of Northwind Power Development Corp.; and the 81-MW Caparispisan project of North Luzon Renewable Energy Corp.

The current FiT rate for wind projects is P8.53 per kilowatt-hour (kWh). The rate is linked to an installation target issued by the DOE of 200 MW, which was later raised to 400 MW. However, the total capacity of wind-projects built and commissioned or to be commissioned within the year exceeds 200 MW.

To accommodate the increased capacity allocation of wind-power projects from 200 MW to 400 MW, NREB filed for an adjustment in FiT rates.

NREB initially applied for P9.49 per kWh and later on revised the proposed rate to P7.93 per kWh for the second batch of wind-power projects that have been commissioned or are to be commissioned within the year, totaling to 393 MW.

The NREB assumed that the other wind projects that will be eligible under the second round of FiT are Trans-Asia Renewable Energy Corp.’s 54-MW Guimaras wind project; PetroWind Energy Inc.’s 36-MW Nabas wind farm; and Alternergy Wind One Corp.’s 54-MW Pililla wind project.

The FiT rate for solar was recently adjusted to P8.69 per kWh, after the capacity allocation was hiked to 500 MW, from the original P9.68 per kWh.

FiT is the per kWh rate guaranteed to RE developers to ensure the viability of their projects. Consumers are the ones who shoulder this under FiT-Allowance, a separate line component in the power bills. They are now paying an additional P0.0406 per kWh since February this year.

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