RPS to trigger higher power cost

by Myrna Velasco, 17 May 2015
from Manila Bulletin

Electricity consumers will brace for added ‘financial scourge’ once government implements the mandated Renewable Portfolio Standard (RPS), a policy that aims to further stimulate renewable energy investments in the country.

National Renewable Energy Board chairman Pete H. Maniego Jr. has admitted that the RPS once issued and enforced by the Department of Energy (DOE) will certainly have cost impact on the consumers.

He qualified this early though that they have been weighing such ‘financial knock’ on the consumers’ pockets before finalizing the rules so it will not come as ‘cost shock’ when reflected in the electricity bills.

“For the RPS, it is the DOE that will finalize and issue the guidelines,” Maniego said when queried as to the policy’s enforcement and how much the per kilowatt hour (kWh) impact of it would be.

He stressed that “there are no projections yet, but that’s one thing that the DOE has been considering – what will be the impact on prices. They are trying to make sure that the impact won’t be as high like in the FIT (feed-in-tariff).”

RPS is a policy intended to stimulate increased investments in renewable energy. It generally sets a percentage as to the level of RE capacity that power producers must come up with.

Maniego admitted that the Philippines is just among the not-so-many-countries that have enforced twin policies of FIT and RPS in their RE sectors, hence, the need for extra caution at implementation phase.

He reiterated “we’re the few if not the only one with both FIT and RPS mechanisms.” And with all the anticipated cost impacts, Filipino electricity consumers may not just turn happy with mandated ‘green energy preference’ when their scrimp and save strategy on budgets will be constantly on assault.

Draft of the country’s RPS had been circulated as early as 2012, but even with several re-tooling and fine-tuning of the policy, it still ends up in the energy department’s torpid files.

The latest version, it was noted, was a handiwork of the legal and policy crafting team of outgoing Energy Secretary Carlos Jericho L. Petilla.

While consultations had been held previously with the industry players, no one knows for now what exactly will the final version be of the RPS for the RE sector.